TIDMGRI
RNS Number : 1966U
Grainger PLC
22 November 2023
22 November 2023
Grainger plc
Full year financial results
for the twelve months ended 30 September 2023
An outstanding year of record delivery
and an excellent outlook
-- Delivering 1,640 new homes in 2023
-- Net Rental Income up +12%
-- EPRA Earnings up +41%
-- Total dividend per share up +11%
-- Adjusted Earnings up +4%
-- Like-for-like PRS rental growth up +8.0%
-- EPRA NTA resilient at 305pps
-- Customer NPS up 26% to +43pts
-- Doubling post tax EPRA earnings from FY22 in next 3 years
Grainger plc, the UK's largest listed residential landlord and
leader in the build-to-rent sector, today announces an outstanding
year of record delivery and a strong performance for the 12 months
ended 30 September 2023. Grainger has a GBP3.3bn operational
portfolio of 10,208 private rental homes and a GBP1.6bn, 5,634-home
build-to-rent pipeline.
Helen Gordon, Chief Executive, said:
"It is with great pleasure that I can report an outstanding year
of record delivery and a strong performance for Grainger, growing
net rental income strongly and enabling us to increase our dividend
to our shareholders by 11%, while improving the rental experience
for our growing number of customers.
"We are now delivering our pipeline at pace and are set to
deliver market-leading earnings growth, a culmination of years of
planning and implementation since setting out the Company strategy
in 2016. We have delivered c.1,200 new build-to-rent homes and are
scheduled to deliver a further c.400 by the end of the calendar
year. This year, we have exceeded more than GBP100m of annual net
rental income on a passing basis, which is more than three times
what it was at the start of the strategy. We now own and operate
more than 10,000 rental homes nationally and this is set to grow
significantly over the coming years. Our PRS portfolio now
represents 77% of our operational portfolio by value.
"In the next three years, post-tax EPRA earnings will double
compared to last year, as we deliver our fully-funded committed
pipeline.
"Despite the macro-economic turbulence which marked the
beginning of our financial year, the Grainger business has
performed exceptionally well. This performance has been delivered
by our market-leading operating platform, robust balance sheet and
disciplined approach to capital allocation. Our property valuations
held up well, underpinned by strong rental growth. Our capital
discipline puts us in a strong position from a balance sheet
perspective too, with our cost of debt fixed in the mid 3% for the
next five years, enabling us to deliver on our committed pipeline
and continue our growth trajectory.
"Our market-leading operating platform continues to drive value
both for shareholders and residents. Occupancy in our PRS portfolio
remains at an all-time high of 98.6%. Like-for-like rental growth
is also strong at 8.0% for our PRS portfolio, in line with wage
inflation, split between 9.2% on new lets and 7.2% on renewals,
demonstrating our commitment to customer loyalty.
"Our focus on customer service is proving successful, with
customer satisfaction levels continuing to rise. We are achieving
industry-leading customer satisfaction levels, with our Net
Promoter Score now +43, ahead of many well-known consumer
brands.
"We remain very conscious of the affordability challenges facing
many renters, and therefore closely monitor rent affordability in
our rental communities across the UK, seeking to closely align
rental increases with wage inflation. Our average customer rental
affordability is c.28% of gross income, well below the widely
accepted one-third threshold. In addition, our homes are highly
energy efficient, providing our customers with lower energy bills,
and many customers benefit from free Wifi, free on-site gyms, free
resident lounges and co-working spaces, on-site Resident Services
teams and much more.
"We are pleased today to announce a new partnership with Network
Rail and bloc group, through their joint venture 'Blocwork', which
will provide Grainger a new route for growth giving us optionality
to forward fund and acquire a number of build-to-rent schemes
across Network Rails' expansive land holdings.
"We remain in a very strong position to continue to deliver
great performance and a great rental experience to our customers,
with everyone at Grainger committed to our collective purpose of
'Renting homes and Enriching lives'."
Highlights
-- +12% growth delivered in Net Rental Income(1) to GBP96.5m
(FY22: GBP86.3m)
-- +41% growth delivered in EPRA Earnings to GBP39.8m (FY22:
GBP28.2m)
-- Final dividend up +11% to 6.65p per share (FY22: 5.97p per
share)
-- Adjusted Earnings(2) grown +4% to GBP97.6m (FY22:
GBP93.5m)
-- +8.0% like-for-like rental growth(3) in our PRS portfolio
(FY22: 4.8%)
-- +9.2% like-for-like rental growth on new lets in our PRS
portfolio (FY22: 5.6%)
-- +7.2% like-for-like rental growth on renewals in our PRS
portfolio (FY22: 4.1%)
o +5.9% like-for-like rental growth in our Regulated Tenancy
Portfolio (FY22: 4.6%)
o Total, blended like-for-like rental growth of +7.7% across our
whole portfolio (FY22: 4.7%)
-- Occupancy of 98.6% in our PRS portfolio
-- IFRS Profit before tax of GBP27.4m (FY22: GBP298.6m) due to
the prior year one-off GBP81.2m valuation gain from the transfer of
trading assets in preparation for REIT conversion along with a
lower valuation performance in FY23
-- Strong sales performance with GBP194m of sales proceeds
including accelerated asset recycling
-- EPRA NTA proving resilient at 305pps (FY22: 317pps)
-- Strong balance sheet and funding position, debt costs fixed
in mid 3% for the next five years
-- New partnership announced with Network Rail and bloc group to
forward fund and acquire build-to-rent schemes on sites adjacent to
major rail hubs in line with our investment and cluster strategy
(see separate announcement for further details)
-- New acquisition of 65-home build-to-rent scheme in Tottenham
Hale from Waterside Places, a JV between Canal & River Trust
and Muse Places, adjacent to our existing operational asset,
Windlass Apartments
Financial Highlights
Income returns FY22 FY23 Change
-------------------------------------------------- ---------- --------- ---------
Rental growth (like-for-like) 4.7% 7.7% +302 bps
PRS rental growth (like-for-like) 4.8% 8.0% +314 bps
PRS like-for-like (new lets) 5.6% 9.2% +358 bps
FY22 FY23 Change
PRS like-for-like (renewals) 4.1% 7.2% +313 bps
Regulated tenancy rental growth (like-for-like,
annualised) 4.6% 5.9% +126 bps
Net rental income (Note 5) GBP86.3m GBP96.5m +12%
Adjusted earnings (Note 2) GBP93.5m GBP97.6m +4%
EPRA Earnings GBP28.2m GBP39.8m +41%
IFRS Profit before tax (Note 2) (4) GBP298.6m GBP27.4m (91)%
Earnings per share (diluted, after tax)
(Note 9) (4) 30.9p 3.5p (89)%
Dividend per share (Note 10) (5) 5.97p 6.65p +11%
-------------------------------------------------- ---------- --------- ---------
Capital returns FY22 FY23 Change
------------------------------- ---------- ---------- ------------
Total Property Return(6) 7.5% 0.4% (713) bps
Total Accounting Return (Note
3) 8.8% (1.8)% (1,065) bps
EPRA NTA per share (Note 3) 317p 305p (4)%
Net debt GBP1,262m GBP1,416m +12%
Group LTV 33.4% 36.8% +340 bps
Cost of debt (average) 3.1% 3.3% +12 bps
Reversionary surplus GBP248m GBP213m (14)%
------------------------------- ---------- ---------- ------------
Build-to-rent investment pipeline Investment Homes
----------------------------------- ------------ ------
Committed GBP721m 2,609
Secured GBP541m 2,009
Planning/ Legals GBP316m 1,016
----------------------------------- ------------ ------
Total investment value GBP1.6bn 5,634
----------------------------------- ------------ ------
ESG benchmark performance
------------------------------------------ ------------------------------------
FTSE4Good since 2010
ISS ESG Prime Rating
MSCI ESG 'AA'
Sustainalytics ESG Risk Rating Low Risk
EPRA Sustainability Best Practice Reporting Gold Award
CDP (formerly the Carbon Disclosure 'B' Rating
Project)
Workforce Disclosure Initiative 80%
GRESB Public Disclosure 'A' Rating
------------------------------------------------ ------------------------------
Future reporting dates
----------------------- ------------
2024
AGM & Trading update 7 February
Half year results 16 May
Trading update September
Full year results 21 November
----------------------- ------------
(1) Refer to Note 5 for net rental income calculation.
(2) Refer to Note 2 for profit before tax and adjusted earnings
reconciliation.
(3) Rental growth is the average increase in rent charged across
our portfolio on a like-for-like basis.
(4) FY22 IFRS Profit before tax includes an GBP81.2m valuation
uplift from one-off transfers from trading property to investment
property.
(5) Dividends - Subject to approval at the AGM, the final
dividend of 4.37p per share (gross) amounting to GBP32.2m will be
paid on 14 February 2024 to Shareholders on the register at the
close of business on 29 December 2023. Shareholders will again be
offered the option to participate in a dividend reinvestment plan
and the last day for election is 24 January 2024. An interim
dividend of 2.28p per share amounting to a total of GBP16.9m was
paid to Shareholders on 3 July 2023 - refer also to Note 10.
(6) Total Property Return (TPR) represents the change in gross
asset value, net of capital expenditure incurred, plus net income,
expressed as a percentage of gross asset value.
Results presentation
Grainger plc will be holding a presentation of the results at
08:45am (UK time) today, 22 November 2023, which can be accessed
via webcast and a telephone dial-in facility (details below), which
will be followed by a live Q&A session for sell side analysts
and shareholders.
Webcast details:
To view the webcast, please go to the following URL link.
Registration is required.
https://brrmedia.news/GRI_FY23
The webcast will be available for six months from the date of
the presentation.
Conference call details:
Call: +44 (0) 330 551 0200
Confirmation Code: Quote Grainger - Full Year Results when
prompted by the operator
A copy of the presentation slides will also be available to
download on Grainger's website (
http://corporate.graingerplc.co.uk/ ) from 08:00am (UK time).
For further information, please contact:
Investor relations
Kurt Mueller, Grainger plc: +44 (0) 20 7940 9500
Media
Ginny Pulbrook / Geoffrey Pelham-Lane, Camarco: +44 (0) 20 3757 4992 / 4985
Forward-looking statements disclaimer
This publication contains certain forward-looking statements.
Any statement in this publication that is not a statement of
historical fact including, without limitation, those regarding
Grainger plc's future financial condition, business, operations,
financial performance and other future events or developments
involving Grainger, is a forward-looking statement. Such statements
may, but not always, be identified by words such as 'expect',
'estimate', 'project', 'anticipate', 'believe', 'should', 'intend',
'plan', 'could', 'probability', 'risk', 'target', 'goal',
'objective', 'may', 'endeavour', 'outlook', 'optimistic',
'prospects' and similar expressions or variations on these
expressions. By their nature, forward-looking statements involve
inherent risks, assumptions and uncertainties as they relate to
events which occur in the future and depend on circumstances which
may or may not occur and go beyond Grainger's ability to control.
Actual outcomes or results may differ materially from the outcomes
or results expressed or implied by these forward-looking
statements. Factors which may give rise to such differences include
(but are not limited to) changing economic, financial, business,
regulatory, legal, political, industry and market trends, house
prices, competition, natural disasters, terrorism or other social,
political or market conditions.
Grainger's principal risks are described in more detail in its
Annual Report and Accounts, set out in the Risk Management report
on pages 62 to 67 of the 2023 Annual Report and Accounts.
A number of risks faced by the Group are not directly within our
control such as the wider economic and political environment.
In line with our risk management approach the key risks to the
business are under regular review by the Board and management,
applying Grainger's risk management framework. It is currently
considered that the principal risks previously reported remain our
principal risks. The risks to Grainger will continue to be
monitored closely as well as the potential controls and mitigants
that may be applied.
These risks and other factors could adversely affect the outcome
and financial effects of the events specified in this publication.
The forward-looking statements reflect knowledge and information
available at the date they are made and Grainger plc does not
intend to update on the forward-looking statements contained in
this publication.
This publication is for information purposes only and no
reliance may be placed upon it. No representative or warranty,
either expressed or implied, is provided in relation to the
accuracy, completeness or reliability of the information contained
in this publication. Past performance of securities in Grainger plc
cannot be relied upon as a guide to the future performance of such
securities.
This publication does not constitute an offer for sale or
subscription of, or solicitation of any offer to buy or subscribe
for, any securities of Grainger plc.
Chief Executive's Statement
An Outstanding Year of Record Delivery
It is with great pleasure that I can report another year of
strong performance for your Company.
This year marks a year of record delivery of new homes for
Grainger, leading to strong growth in net rental income and your
dividend. We are delivering 1,640 new homes, 1,201 of which are
completed and a further 439 completing later this calendar
year.
We are now delivering our pipeline at pace and are set to
deliver market-leading earnings growth, a culmination of years of
planning and implementation since setting out the Company strategy
in 2016.
This year, we have increased net rental income by 12%, exceeding
more than GBP100m of annual net rental income on a passing basis,
which is more than three times what it was at the start of the
strategy.
Despite the macro-economic turbulence that marked the beginning
of our financial year, the Grainger business has performed
exceptionally well, with our market-leading operating platform,
robust balance sheet and disciplined approach to capital
allocation.
We now own and operate more than 10,000 rental homes nationally
and this is set to grow significantly over the coming years.
Our market-leading operating platform continues to drive value
both for Shareholders and residents. PRS occupancy remains at an
all-time high of 98.6%. Like-for-like rental growth is also
exceptionally strong at 8.0% for our PRS portfolio, which now
represents 77% of our portfolio by value. Like-for-like rental
growth on new lets in our PRS portfolio was 9.2% for the year,
while like-for-like rental growth for renewals was 7.2%,
demonstrating our commitment to customer loyalty.
Customer satisfaction has continued to rise, and occupancy and
retention have continued to increase. On average, our PRS customers
stay with us for 32 months.
We are achieving industry-leading customer satisfaction levels,
with our Net Promoter Score now +43, ahead of many well-known
consumer brand names.
We remain very conscious of the affordability challenges facing
many renters, and therefore closely monitor rents against wage
growth to protect affordability levels in our rental communities
across the UK. On average, our customers spend 28% of their income
on rent, below the national average.
Despite the turmoil in the financial markets and rising interest
rates, which has badly affected other real estate markets
throughout the UK and globally, UK residential has proven
resilient, with Grainger's valuations holding up well, only 2.4%
down in the year, underpinned by exceptional rental growth. This is
reflected in the movements in Profit Before Tax and EPRA NTA in the
year. In the year prior, PBT was enhanced by the transfer of
trading assets in preparation for REIT conversion. In September
2022, in the wake of the mini-Budget, we put in place an
outperformance plan which delivered an increase in adjusted
earnings despite macro-economic headwinds. We delivered a strong
sales performance in a challenging market with GBP194m of sales
including our accelerated asset recycling programme, consisting of
regulated tenancies, old style PRS assets and strategic land.
We have closely managed costs, and while facing energy,
insurance and other rising costs, we maintained our operating costs
in line with last year with stabilised gross-to-net held at
25.5%.
Our capital discipline puts us in a strong position from a
balance sheet perspective, with our cost of debt fixed in the mid
3% for the next five years, enabling us to deliver on our committed
pipeline and continue our growth trajectory.
There's much to look forward to.
In the next three years, post-tax EPRA earnings will double
compared to last year, as we deliver our pipeline.
Our enhancements to our operating platform, our investment in
technology, data science and analysis, and customer experience,
will continue to support our growth, deliver efficiencies and
improve our residents' experience of renting.
Our Market Opportunity
The UK private rented sector comprises 5.5 million households.
Large-scale, institutional landlords (often referred to as
build-to-rent), like Grainger, make up only 1.7% of the sector. The
total addressable market we have in front of us is therefore vast
and it is growing, with the demand for renting expanding while
supply is reducing. This year we have seen many small landlords
continue to exit the market, further increasing the demand for our
homes.
All of this is underpinned by the single biggest defining
characteristic of the UK housing market, which is one of severe
undersupply of all types and tenures of housing. It is estimated
that the shortfall is 4.3m homes [1] and growing as housing supply
numbers continue to fall short of increasing demand.
As these numbers show, there is a huge opportunity for Grainger
to increase our market share and support the UK in delivering more,
high quality rental homes.
Our Commitment to Acting Responsibly
As a leading housing provider in the UK, we take this
responsibility very seriously from how we treat our customers,
colleagues and suppliers, through building safety, reducing our
environmental impact and continuing to enhance our positive social
impact.
From the Board to our on-site teams, everyone plays a part.
I am pleased that, for the first time, we are now able to fully
report our carbon emissions across all Scopes 1, 2 and 3. This
enables us to build on our existing commitment to be net zero
carbon in operations by 2030, and we have set ourselves a new
target to reduce upfront embodied carbon by 40% excluding
offsetting for direct development schemes in design by 2030.
Our Living a Greener Life campaign, which supports our residents
in reducing their carbon footprint (which is by far one of
Grainger's largest components of our carbon emissions in Scope 3),
was recognised by industry peers as market-leading, when we were
awarded the Outstanding Contribution to Society Award for
Environment by EPRA, the European Public Real Estate
Association.
We are leading the sector in our approach to building safety,
going beyond what's been set out in the new Building Safety Act,
continuing to build on our Live.Safe programme.
Through an innovative partnership with the White Rose charity,
we have enabled residents to give 18,700kg of clothing to charity,
generating c.GBP100,000 for the charity and saving 67 tonnes of
carbon in the process.
Positively Engaging in the Political Debate on Housing
Grainger is committed to improving the experience of renters and
is taking a proactive approach to engaging with all political
parties to help inform and shape public policy affecting housing
and renting. This year, more than ever, we have engaged on issues
important to us and our residents, from raising standards in the
rental sector to building safety and energy efficiency standards.
We are working hard to make the case for the importance of
encouraging institutional investment into the build-to-rent sector
and the benefits that it can bring to regional growth, economic
productivity and regeneration.
We were pleased when the Conservative Government and Labour
Party both publicly ruled out rent controls in England, recognising
the damage they would do to supply, and ultimately renters.
Equally, we were pleased to see the proposals for rental reform in
Parliament reflect many of the points we made to Government
throughout the consultation process, and that these reforms align
to our responsible business model.
Putting People at the Heart of our business
To maintain our leading position in the sector and to support
our growth ambitions, it is important that we can continue to
attract and retain the best possible talent into the sector and our
business. Our People Strategy, and the detailed action planning
that sits behind it, ensures Grainger can maintain our position as
a top employer.
An important aspect of this is our listening culture, which we
support through our internal engagement programme. Colleague
feedback is regularly sought and acted upon, with close attention
paid by the Board and Executive Committee. I am therefore very
pleased to report that our employee engagement scores have once
again improved materially, and recognise Grainger as a 'Very Good'
place to work. All areas of the business have now achieved a 'Star
rating' in our annual employee engagement survey.
Equally, we recognise that Grainger's future success is
predicated on being welcoming to as many talented colleagues and
residents from as many walks of life as possible. Two very
compelling reasons behind our strong commitment to promoting
Diversity, Equality and Inclusion (DEI) both for colleagues and
residents alike.
We continue to support greater diversity of all types across all
levels of the business, with, for example, our gender pay gap
continuing to reduce, due to the deliberate actions we are taking.
We now have exceptionally high diversity data coverage for our
colleagues, which will enable the business to effectively support
its colleagues across all aspects of diversity. A notable step this
year, was the Company's commitment to achieving the UK's highest
standard for DEI, the National Equality Standard.
Another Strong Performance with a Confident Outlook
The business delivered another strong performance for the year,
and remains in a good position to continue to successfully deliver
on our strategic growth plans, the quality of our product and our
commitment to excellent customer service.
Our disciplined investment approach means we have the funding in
place to deliver our sizeable pipeline of committed projects. Our
reliable cashflow from the unwinding of our regulated tenancy
portfolio and our successful asset recycling programme provides us
sufficient capacity for continued growth.
We remain in a very strong position to continue to deliver great
performance and a great rental experience to our customers.
I'd like to thank the whole Grainger team and their tremendous
effort and commitment to delivering on our collective purpose of
'Renting homes and Enriching lives'.
Helen Gordon
CEO
21 November 2023
Financial review
FY23 was another year of excellent performance for the business
driven by the strength of our platform and demand for our mid
market product. Operationally, we have capitalised on these
dynamics and delivered strong results. Occupancy is high at 98.6%,
LFL rental growth strong at 7.7% across the portfolio overall and
higher in our PRS portfolio at 8.0%. The investment we are making
in our pipeline is continuing to deliver annual step changes in our
net rent with a 12% increase this year. Indeed, FY23 was a record
year of both investment and delivery (GBP312m invested in new
homes), with 1,201 new homes delivered and a further 439 scheduled
to complete in calendar year 2023.
Despite the challenging economic backdrop, we have delivered
excellent sales profits and delivered on our strategy of increasing
asset recycling, with total sales for the year at GBP193.7m.
Valuations have remained resilient in the period, reducing just 4%
(GBP70m), with the strong operational performance driving ERV
growth which in turn largely offset outward yield movement. The
close relationship between rental growth and wage inflation was
again evident in the year and demonstrates our natural valuation
hedge in a high inflation and interest rate environment.
The balance sheet remains in good shape with net debt broadly
flat on the half year position and with debt costs fixed in the mid
3% and no further material refinancing due until 2028, we have very
limited exposure to rising interest rates in the medium term.
With a further 50% increase in net rents to come from our
committed pipeline we are on track to deliver significant earnings
growth over the coming years. The proposed final dividend for the
year is 4.37 pence per share, taking the total dividend for the
year to 6.65 pence per share, up 11% demonstrating the continuing
growth in net rents.
Financial highlights
Income return FY22 FY23 Change
------------------------------ --------- -------- --------
Rental growth (like-for-like) 4.7% 7.7% +302 bps
Net rental income (Note 5) GBP86.3m GBP96.5m +12%
Adjusted earnings (Note 2) GBP93.5m GBP97.6m +4%
Profit before tax (Note 2) GBP298.6m GBP27.4m (91)%
Dividend per share (Note 10) 5.97p 6.65p +11%
Capital return FY22 FY23 Change
------------------------------------ --------- --------- ---------
EPRA NTA per share (Note 3) 317p 305p (4)%
Total Property Return 7.5% 0.4% (713) bps
Total Accounting Return (NTA basis) (1,065)
(Note 3) 8.8% (1.8)% bps
Net debt GBP1,262m GBP1,416m +12%
Group LTV 33.4% 36.8% +340 bps
Cost of debt (average) 3.1% 3.3% +12 bps
------------------------------------ --------- --------- ---------
Income statement
Adjusted earnings increased by +4% to GBP97.6m (FY22: GBP93.5m)
as a result of another strong year of increasing net rents which
were up 12%, and a resilient sales performance with vacant sales
profits up despite the naturally shrinking portfolio.
IFRS Profit before tax was GBP27.4m, down from GBP298.6m in the
prior year as result of the one-off GBP81.2m valuation gain from
the transfer of trading assets in FY22 in preparation for REIT
conversion, along with a lower valuation performance.
The operational leverage inherent in our business model means
that EPRA earnings have increased by 41% to GBP39.8m (FY22:
GBP28.2m) as we continued to deliver our pipeline and launch new
homes.
Income statement (GBPm) FY22 FY23 Change
------------------------------ ------ ------ --------
Net rental income 86.3 96.5 +12%
Profit on sale of assets -
residential 65.3 57.8 (11)%
CHARM income (Note 15) 4.8 4.7 (2)%
Management fees 4.4 5.0 +14%
Overheads (31.8) (33.5) +5%
Pre-contract costs (0.8) (1.2) +50%
Joint ventures and associates (1.4) 0.1 (107)%
Net finance costs (33.3) (31.8) (5)%
------ ------ --------
Adjusted earnings 93.5 97.6 +4%
Valuation movements 133.4 (70.2) (153)%
Other valuation movements(1) 81.2 - (100)%
Other adjustments (9.5) - (100)%
------ ------ --------
Profit before tax 298.6 27.4 (91)%
------------------------------ ------ ------ --------
(1) Profit before tax includes an GBP81.2m valuation uplift from
one-off transfers from trading property to investment property in
FY22 in preparation for REIT conversion, and GBP9.5m fire safety
provision following full review of legacy projects.
Rental income
Net rental income was up +12% during the year at GBP96.5m (FY22:
GBP86.3m) reflecting continued delivery of our PRS pipeline. Like
for like growth was strong at 7.7% (FY22: 4.7%), broadly in line
with national wage growth, with 8.0% rental growth in our PRS
portfolio (FY22: 4.8%) and 5.9% in our regulated tenancy portfolio
(FY22: 4.6%). New lets in our PRS portfolio delivered 9.2% rental
growth with a lower level of 7.2% on renewals, reflecting our
retention strategy.
FY23 was a record year of deliveries with 1,201 homes delivered
across 6 schemes with a combined net rent roll of GBP13m which will
benefit next years net rent by c.GBP8m. We continue to remain
focused on cost efficiency with g ross to net for the period on our
stabilised portfolio at 25.5%, consistent with previous
periods.
GBPm
----------------------- -----
FY22 Net rental income 86.3
Disposals (2.8)
PRS Investment 4.3
LFL Rental growth 8.7
-----
FY23 Net rental income 96.5
-----
Sales and development activity
Sales revenues increased in line with our plan of delivering
high levels of asset recycling. Overall sales profits were GBP57.8m
(FY22: GBP65.3m), reflecting the mix of trading and investment
sales with revenues increasing to GBP193.7m (FY22: GBP174.7m). We
delivered GBP34.1m of profit from vacant property sales (FY22:
GBP32.4m) from revenues of GBP70.1m (FY22: GBP73.9m) with sales
prices achieved that were a modest -1.9% of previous valuations
reflecting the attractiveness of these unique assets.
Sales of tenanted properties delivered GBP19.4m of profit (FY22:
GBP30.9m) from revenues of GBP88.1m (FY22: GBP74.8m), the lower
profit margins reflecting the higher level of investment sales
compared to trading tenanted asset sales. Development profits
increased to GBP4.3m (FY22: GBP2.0m) from revenues of GBP35.5m
(FY22: GBP26.0m) as a result of a profitable exit from a legacy
scheme at Seven Sisters and strong land sales at our Berewood
site.
FY22 FY23
--------------- ---------------
Sales (GBPm) Revenue Profit Revenue Profit
Residential sales on
vacancy 73.9 32.4 70.1 34.1
Tenanted and other
sales 74.8 30.9 88.1 19.4
------- ------ ------- ------
Residential sales
total 148.7 63.3 158.2 53.5
Development activity 26.0 2.0 35.5 4.3
--------------------- ------- ------ ------- ------
Overall sales 174.7 65.3 193.7 57.8
--------------------- ------- ------ ------- ------
Balance sheet
Our balance sheet remains in a strong position with LTV of 36.8%
(FY22: 33.4%) following a record year of investment in our
pipeline. This represents a small increase on the half year
position (HY23: 36.1%).
We have a very strong liquidity and cash position with headroom
of GBP519m (FY22: GBP663m), and our committed pipeline is fully
funded and our debt costs are almost fully hedged meaning we have
minimal exposure to potential interest rate rises over the next
five years. Following a strong year of delivery our PRS portfolio
now represents 77% of our asset base.
Market value balance sheet (GBPm) FY22 FY23
---------------------------------------------- ---------- --------
Residential - PRS 2,189 2,423
Residential - regulated tenancies 812 693
Residential - mortgages (CHARM) 69 67
Forward Funded - PRS work in progress 466 441
Development work in progress 182 126
Investment in JVs/associates 55 91
---------- --------
Total investments 3,773 3,841
Net debt (1,262) (1,416)
Other liabilities (41) (66)
---------- --------
EPRA NRV 2,470 2,359
Deferred and contingent tax - trading assets (111) (91)
Exclude: intangible assets - (1)
---------- --------
EPRA NTA 2,359 2,267
Add back: intangible assets - 1
Deferred and contingent tax - investment
assets (116) (106)
Fair value of fixed rate debt and derivatives 240 171
--------
EPRA NDV 2,483 2,333
---------------------------------------------- ---------- --------
EPRA NRV pence per share 333 318
EPRA NTA pence per share 317 305
EPRA NDV pence per share 334 314
EPRA NTA decreased 4% during the year to 305p per share (FY22:
317p per share). The decrease was largely driven by a 13p reduction
from valuations with a 5p positive contribution from EPRA earnings,
offset by the payment of our final dividend (6p). This NTA measure
excludes the mark to market of our fixed rate debt which is GBP171m
or 23 pence per share.
EPRA NTA movement
----------------------------------------------------------------------
GBPm Pence per share
------ ----------------
EPRA NTA at 30 September 2022 2,359 317
Net rents, fees & income 106 14
Overheads (34) (5)
Finance costs (32) (4)
------ ----------------
EPRA earnings 40 5
Valuations (trading & investment property) (93) (13)
Sales profit 4 1
Tax & other 3 1
Dividends (46) (6)
-------------------------------------------- ------ ----------------
EPRA NTA at 30 September 202 3 2,267 305
-------------------------------------------- ------ ----------------
Property portfolio performance
Our overall portfolio valuation was down 2.4% (FY22: increase of
4.4%) with our stabilised PRS portfolio decreasing by 2.3% (FY22:
increase of 4.6%) and our regulated portfolio decreasing by 2.0%
(FY22: increase of 4.1%). While yields on our PRS portfolio moved
out by c.40bps as a result of the macro economic environment, the
majority of the valuation impact was offset by the 8.1% ERV growth
that we delivered during the year. Our Regional PRS portfolio
outperformed London and South East given that it only experienced
30 bps yield shift compared to 50bps in London. ERV growth in
London and South East was 8.8% compared to 7.3% in the Regions.
Portfolio Region Capital Total Valuation
Value movement
(GBPm) GBPm %
---------- ---------------- -------- -------- -------
PRS London & SE 1,324 (67) (5.2)%
Regions 1,099 11 (1.2%)
--------------------------- -------- -------- -------
PRS Total 2,423 (56) (2.3%)
REGS London & SE 590 (11) (1.9)%
Regions 103 (3) (2.5)%
--------------------------- -------- -------- -------
REGS Total 693 (14) (2.0)%
--------------------------- -------- -------- -------
Operational Portfolio 3,116 (70) (2.0)%
PRS Development 567 (21) (3.8)%
--------------------------- -------- -------- -------
Total Portfolio 3,683 (91) (2.4)%
---------------------------- -------- -------- -------
Financing and capital structure
Our capital structure remains in a very strong position. Net
debt for the year was GBP1,416m (FY22: GBP1,262m) with GBP209m of
operational cashflows including asset recycling, offset by GBP312m
of investment in our PRS pipeline, GBP47m of dividends and GBP4m of
tax and other payments. This however represents an increase of only
GBP22m compared to the half year (HY23: GBP1,394m) as capex spend
decreased and asset recycling increased.
During the year we successfully extended GBP915m of bank
facilities by one year and now have no material refinancing
requirements until 2028. The average cost of debt increased only
marginally to 3.3% (FY22: 3.1%) during the period as a result of
our strong hedging profile with a maturity of five years that will
ensure our interest costs remain in the mid 3%. From FY24 onwards
we expect capex to be funded by operational cashflows including
asset recycling.
FY22 FY23
------------------------------------ ---------- ----------
Net debt GBP1,262m GBP1,416m
Loan to value 33.4% 36.8%
Cost of debt 3.1% 3.3%
Headroom GBP663m GBP519m
Weighted average facility maturity
(years) 6.5 5.5
Hedging 97% 95%
------------------------------------- ---------- ----------
Summary and outlook
Following another strong year of performance, we see the high
levels growth in net rents and earnings set to continue as our
pipeline continues to deliver. With a solid balance sheet and
strong operational cashflow generation we are well placed to
continue our growth trajectory.
Despite the economic challenges, the nature of our business
model and the resilience of our income stream mean that our growth
continues, with a fully funded pipeline and debt costs fixed we
will continue to see a step change in rents and earnings cover the
coming years.
Rob Hudson
Chief Financial Officer
21 November 2023
Consolidated income statement
2023 2022
For the year ended 30 September Notes GBPm GBPm
---------------------------------------------------------------------------- ------- ------- -------
Group revenue 4 267.1 279.2
---------------------------------------------------------------------------- ------- ------- -------
Net rental income 5 96.5 86.3
Profit on disposal of trading property 6 54.8 64.4
Profit on disposal of investment property 7 3.3 1.7
Income from financial interest in property assets 15 4.6 6.0
Fees and other income 8 5.0 4.4
Administrative expenses (33.5) (31.8)
Other expenses (1.2) (10.3)
Goodwill impairment (0.1) -
(Impairment)/reversal of impairment of inventories to net realisable value 12 (1.0) 1.5
Operating profit 128.4 122.2
Net valuation (losses)/gains on investment property 11 (68.8) 129.0
Net valuation gains on investment property reclassifications 1c, 11 - 81.2
Finance costs (34.0) (34.6)
Finance income 2.2 1.3
Share of (loss)/profit of associates after tax 13 (0.1) 1.2
Share of loss of joint ventures after tax 14 (0.3) (1.7)
---------------------------------------------------------------------------- ------- ------- -------
Profit before tax 2 27.4 298.6
Tax charge 20 (1.8) (69.2)
---------------------------------------------------------------------------- ------- ------- -------
Profit for the year attributable to the owners of the Company 25.6 229.4
---------------------------------------------------------------------------- ------- ------- -------
Basic earnings per share 9 3.5p 31.0p
Diluted earnings per share 9 3.5p 30.9p
---------------------------------------------------------------------------- ------- ------- -------
Consolidated statement of comprehensive income
2023 2022
For the year ended 30 September Notes GBPm GBPm
------------------------------------------------------------------------------------------ ------ ------- ---------
Profit for the year 2 25.6 229.4
------------------------------------------------------------------------------------------ ------ ------- ---------
Items that will not be transferred to the consolidated income statement:
Remeasurement of BPT Limited defined benefit pension scheme 21 (1.1) 5.7
Items that may be or are reclassified to the consolidated income statement:
Changes in fair value of cash flow hedges (16.1) 47.3
------------------------------------------------------------------------------------------ ------ ------- ---------
Other comprehensive income and expense for the year before tax (17.2) 53.0
------------------------------------------------------------------------------------------ ------ ------- ---------
Tax relating to components of other comprehensive income:
Tax relating to items that will not be transferred to the consolidated income statement 20 0.3 (1.4)
Tax relating to items that may be or are reclassified to the consolidated income
statement 20 4.0 (11.9)
------------------------------------------------------------------------------------------ ------ ------- ---------
Total tax relating to components of other comprehensive income 4.3 (13.3)
------------------------------------------------------------------------------------------ ------ ------- ---------
Other comprehensive income and expense for the year after tax (12.9) 39.7
------------------------------------------------------------------------------------------ ------ ------- ---------
Total comprehensive income and expense for the year attributable to the owners of the
Company 12.7 269.1
------------------------------------------------------------------------------------------ ------ ------- ---------
Consolidated statement of financial position
2023 2022
As at 30 September Notes GBPm GBPm
---------------------------------------------- ------ -------- --------
ASSETS
Non-current assets
Investment property 11 2,948.9 2,775.9
Property, plant and equipment 8.6 4.2
Investment in associates 13 15.8 16.7
Investment in joint ventures 14 75.2 38.5
Financial interest in property assets 15 67.0 69.1
Retirement benefits 21 9.6 9.8
Deferred tax assets 20 3.7 1.2
Intangible assets 1.0 0.5
---------------------------------------------- ------ -------- --------
3,129.8 2,915.9
---------------------------------------------- ------ -------- --------
Current assets
Inventories - trading property 12 392.2 453.8
Trade and other receivables 16 34.0 40.5
Derivative financial instruments 19 45.3 56.5
Current tax assets - 16.5
Cash and cash equivalents 121.0 95.9
592.5 663.2
---------------------------------------------- ------ -------- --------
Total assets 3,722.3 3,579.1
---------------------------------------------- ------ -------- --------
LIABILITIES
Non-current liabilities
Interest-bearing loans and borrowings 19 1,533.5 1,317.6
Trade and other payables 17 6.9 2.2
Provisions for other liabilities and charges 18 1.1 1.1
Deferred tax liabilities 20 122.3 136.9
---------------------------------------------- ------ -------- --------
1,663.8 1,457.8
---------------------------------------------- ------ -------- --------
Current liabilities
Interest-bearing loans and borrowings 19 - 40.0
Trade and other payables 17 120.7 105.9
Provisions for other liabilities and charges 18 8.6 8.6
Current tax liabilities 0.6 -
---------------------------------------------- ------ -------- --------
129.9 154.5
---------------------------------------------- ------ -------- --------
Total liabilities 1,793.7 1,612.3
---------------------------------------------- ------ -------- --------
NET ASSETS 1,928.6 1,966.8
---------------------------------------------- ------ -------- --------
EQUITY
Issued share capital 37.2 37.1
Share premium account 817.8 817.6
Merger reserve 20.1 20.1
Capital redemption reserve 0.3 0.3
Cash flow hedge reserve 20.0 32.1
Retained earnings 1,033.2 1,059.6
---------------------------------------------- ------ -------- --------
TOTAL EQUITY 1,928.6 1,966.8
---------------------------------------------- ------ -------- --------
Consolidated statement of changes in equity
Cash
Issued Capital flow
share Share Merger redemption hedge Retained Total
capital premium account reserve reserve reserve earnings equity
Notes GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Balance as at
1 October 2021 37.1 817.3 20.1 0.3 (3.3) 867.5 1,739.0
Profit for the year 2 - - - - - 229.4 229.4
Other comprehensive
income for the
year - - - - 35.4 4.3 39.7
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Total comprehensive
income - - - - 35.4 233.7 269.1
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Award of SAYE
shares - 0.3 - - - - 0.3
Purchase of own
shares - - - - - (3.3) (3.3)
Share-based
payments charge 22 - - - - - 1.7 1.7
Dividends paid - - - - - (40.0) (40.0)
Total transactions
with owners
recorded directly
in equity - 0.3 - - - (41.6) (41.3)
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Balance as at
30 September 2022 37.1 817.6 20.1 0.3 32.1 1,059.6 1,966.8
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Profit for the year 2 - - - - - 25.6 25.6
Other comprehensive
loss for the year - - - - (12.1) (0.8) (12.9)
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Total comprehensive
income - - - - (12.1) 24.8 12.7
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Award of SAYE
shares 0.1 0.2 - - - - 0.3
Purchase of own
shares - - - - - (7.9) (7.9)
Share-based
payments charge 22 - - - - - 2.4 2.4
Dividends paid - - - - - (45.7) (45.7)
Total transactions
with owners
recorded directly
in equity 0.1 0.2 - - - (51.2) (50.9)
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Balance as at
30 September 2023 37.2 817.8 20.1 0.3 20.0 1,033.2 1,928.6
-------------------- ------ --------- ----------------- --------- ------------ --------- ---------- ----------
Consolidated statement of cash flows
2023 2022
For the year ended 30 September Notes GBPm GBPm
------------------------------------------------------ ------- -------- --------
Cash flow from operating activities
Profit for the year 2 25.6 229.4
Depreciation and amortisation 1.1 0.9
Goodwill impairment 0.1 -
Net valuation losses/(gains) on investment
property 11 68.8 (129.0)
Net valuation gains on investment property
reclassifications 1c, 11 - (81.2)
Net finance costs 31.8 33.3
Share of loss of associates and joint ventures 13, 14 0.4 0.5
Profit on disposal of investment property 7 (3.3) (1.7)
Share-based payment charge 22 2.4 1.7
Income from financial interest in property
assets 15 (4.6) (6.0)
Tax charge 20 1.8 69.2
Cash generated from operating activities before
changes in working capital 124.1 117.1
Decrease/(Increase) in trade and other receivables 6.5 (1.9)
Increase in trade and other payables 37.0 8.5
Increase in provisions for liabilities and
charges - 8.4
Decrease in inventories 61.6 24.8
------------------------------------------------------ ------- -------- --------
Cash generated from operating activities 229.2 156.9
Interest paid (46.9) (42.0)
Tax received/(paid) 2.7 (12.3)
Payments to defined benefit pension scheme 21 (0.3) (0.6)
------------------------------------------------------ ------- -------- --------
Net cash inflow from operating activities 184.7 102.0
------------------------------------------------------ ------- -------- --------
Cash flow from investing activities
Proceeds from sale of investment property 7 63.5 20.9
Proceeds from financial interest in property
assets 15 6.7 8.6
Dividends received from associates 13 0.8 -
Investment in joint ventures 14 (34.0) (6.4)
Loans advanced to joint ventures 14 (3.0) (4.4)
Acquisition of investment property 11 (302.0) (289.2)
Acquisition of property, plant and equipment
and intangible assets (6.1) (3.7)
------------------------------------------------------ ------- -------- --------
Net cash outflow from investing activities (274.1) (274.2)
------------------------------------------------------ ------- -------- --------
Cash flow from financing activities
Award of SAYE shares 0.3 0.3
Purchase of own shares (7.9) (3.3)
Proceeds from new borrowings 330.0 14.2
Payment of loan costs (2.3) (6.1)
Cash flows relating to new derivatives / settlement
of derivatives (4.9) (13.7)
Repayment of borrowings (155.0) (0.9)
Dividends paid (45.7) (40.0)
------------------------------------------------------ ------- -------- --------
Net cash inflow/(outflow) from financing activities 114.5 (49.5)
------------------------------------------------------ ------- -------- --------
Net increase/(decrease) in cash and cash equivalents 25.1 (221.7)
Cash and cash equivalents at the beginning
of the year 95.9 317.6
Cash and cash equivalents at the end of the
year 121.0 95.9
------------------------------------------------------ ------- -------- --------
Notes to the preliminary financial results
1. Accounting policies
1a Basis of preparation
The Board approved this preliminary announcement on 21 November
2023. The financial information included in this preliminary
announcement does not constitute the Group's statutory accounts for
t he years ended 30 September 2022 or 30 September 2023. Statutory
accounts for the year ended 30 September 2022 have been delivered
to the Registrar of Companies. The statutory accounts for the year
ended 30 September 2023 will be delivered to the Registrar of
Companies following the Company's annual general meeting.
The auditors, KPMG LLP, have reported on the accounts for both
years. The reports were unqualified, did not include reference to
any matters by way of emphasis and did not contain statements under
section 498 (2) or (3) of the Companies Act 2006.
These financial statements for the year ended 30 September 2023
have been prepared under the historical cost convention except for
the following assets and liabilities, and corresponding income
statement accounts, which are stated at their fair value;
investment property; derivative financial instruments; and
financial interest in property assets.
The accounting policies used are consistent with those contained
in the Group's full annual report and accounts for the year ended
30 September 2023.
The financial information included in this preliminary
announcement has been prepared in accordance with UK-adopted
international accounting standards (IFRS) and applicable law.
1b Adoption of new and revised International Financial Reporting Standards and interpretations
The following new standards and amendments to standards were
issued in the year and have no material impact on the financial
statements:
-- Reference to the conceptual framework (amendments to IFRS
3);
-- Onerous contracts - cost of fulfilling a contract (amendments
to IAS 37);
-- Annual improvements to IFRS Standards 2018-2020;
-- Property, Plant and Equipment: proceeds before intended use
(amendments to IAS 16)
The following new standards and amendments to standards have
been issued but are not yet effective for the Group and have not
been early adopted:
-- Classification of liabilities as current or non-current
(amendments to IAS 1)
-- IFRS 17 insurance contracts
-- Accounting policies, changes in accounting estimates and
errors: definition (amendments to IAS 8)
-- Presentation of financial statements and making materiality
judgements (amendments to IAS 1, IFRS Practice
Statement 2)
-- Deferred tax related to assets and liabilities arising from a
single transaction (amendments to IAS 12)
The application of these new standards and amendments are not
expected to have a material impact on the Group's financial
statements.
1c Significant judgements and estimates
Estimates
i. Valuation of property assets
Residential trading property is carried in the statement of
financial position at the lower of cost and net realisable value
and investment property is carried at fair value. The Group does,
however, in its principal non-GAAP net asset value measures, EPRA
NRV, EPRA NTA and EPRA NDV, include trading property at market
value.
Notes to the preliminary financial results continued
The adjustment in the value of trading property is the
difference between the statutory book value and its market value as
set out in Note 3. For investment property, market value is the
same as fair value. In respect of trading properties, market
valuation is the key assumption in determining the net realisable
value of those properties.
In all cases, forming these valuations inherently includes
elements of judgement and subjectivity with regards to the
selection of unobservable inputs. The valuation basis and key
unobservable inputs are outlined in Note 2 in the 2023 Annual
Report and Accounts.
The results and the basis of each valuation and their impact on
both the financial statements and market value for the Group's
non-GAAP net asset value measures are set out below:
% of properties
for which
external
valuer
PRS Reversionary Other Total provides
GBPm GBPm GBPm GBPm Valuer valuation
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Trading property 10.4 348.9 32.9 392.2
Investment property 2,928.9 20.0 - 2,948.9
Financial asset
(CHARM) - 67.0 - 67.0
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Total statutory
book value 2,939.3 435.9 32.9 3,408.1
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Trading property
Allsop
Residential 9.6 673.3 - 682.9 LLP 84%
Developments - - 51.4 51.4 CBRE Limited 98%
Total trading
property 9.6 673.3 51.4 734.3
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Investment property
Allsop
LLP / CBRE
Residential 329.5 20.0 - 349.5 Limited 100%
Developments 74.7 - - 74.7 CBRE Limited 100%
New build PRS 2,203.3 - - 2,203.3 CBRE Limited 100%
Allsop
Affordable housing 178.7 - - 178.7 LLP 100%
Allsop
Tricomm housing 142.7 - - 142.7 LLP 100%
Total investment
property 2,928.9 20.0 - 2,948.9
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Financial asset Allsop
(CHARM)(1) - 67.0 - 67.0 LLP 100%
Total assets at
market value 2,938.5 760.3 51.4 3,750.2
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Statutory book
value 2,939.3 435.9 32.9 3,408.1
Market value adjustment(2) (0.8) 324.4 18.5 342.1
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Total assets at
market value 2,938.5 760.3 51.4 3,750.2
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Net revaluation
loss recognised
in the income statement
for wholly-owned
properties (68.8)
Net revaluation
loss relating to
joint ventures
and associates(3) (0.5)
---------------------------- -------- --------------- ------ -------- -------------- ----------------
Net revaluation
loss recognised
in the year(3) (69.3)
---------------------------- -------- --------------- ------ -------- -------------- ----------------
(1) Allsop LLP provides vacant possession values used by the
Directors to value the financial asset.
(2) The market value adjustment is the difference between the
statutory book value and the market value of the Group's
properties. Refer to Note 3 for market value net asset
measures.
(3) Includes the Group's share of joint ventures and associates revaluation loss after tax.
Notes to the preliminary financial results continued
Judgments
i. Distinction between investment and trading property
The Group considers the intention at the outset when each
property is acquired in order to classify the property as either an
investment or a trading property. Where the intention is either to
trade the property or where the property is held for immediate sale
upon receiving vacant possession within the ordinary course of
business, the property is classified as trading property. Where the
intention is to hold the property for its long-term rental yield
and/or capital appreciation, the property is classified as an
investment property. The classification of the Group's properties
is a significant judgement which directly impacts the statutory net
asset position, as trading properties are held at the lower of cost
and net realisable value, whilst investment properties are held at
fair value, with gains or losses taken through the consolidated
income statement.
The Group continually reviews properties for changes in use that
could subsequently change the classification of properties. A
change of use occurs if property meets, or ceases to meet, the
definition of investment property which is more than a change in
management's intentions. The fact patterns associated with changes
in the way in which properties are utilised are considered on a
case by case basis and to the extent that a change in use is
established, property reclassifications are reflected
appropriately.
There have been no property reclassifications in the year.
During the prior year, four property portfolios were reclassified
from trading property to investment property where changes in use
had been identified. Trading property with a cost of GBP116.5m and
market value of GBP197.7m was reclassified as investment property,
resulting in valuations gains of GBP81.2m on reclassification which
were recognised in the consolidated income statement. In addition,
GBP20.3m contingent tax on trading property has been reclassified
as deferred tax on investment property in our EPRA NAV metrics
which increased EPRA NTA by 3p per share.
1d Group risk factors
The principal risks and uncertainties facing the Group are set
out in the Risk Management report of the 2023 Annual Report and
Accounts.
A number of risks faced by the Group are not directly within our
control such as the wider economic and political environment.
Risks, including updates to principal risks, are outlined in the
2023 Annual Report and Accounts.
1e Going concern assessment
The Directors are required to make an assessment of the Group's
ability to continue to trade as a going concern for the foreseeable
future. Given market volatility over the past 12 months and the
impact on the macro-economic conditions in which the Group is
operating, the Directors have placed a particular focus on the
appropriateness of adopting the going concern basis in preparing
the financial statements for the year ended 30 September 2023.
The financial position of the Group, including details of its
financing and capital structure, is set out in the financial review
on pages 37 to 42 in the 2023 Annual Report and Accounts. In making
the going concern assessment, the Directors have considered the
Group's principal risks (see pages 64 to 67 in the 2023 Annual
Report and Accounts) and their impact on financial performance. The
Directors have assessed the future funding commitments of the Group
and compared these to the level of committed loan facilities and
cash resources over the medium term. In making this assessment,
consideration has been given to compliance with borrowing covenants
along with the uncertainty inherent in future financial forecasts
and, where applicable, severe sensitivities have been applied to
the key factors affecting financial performance for the Group.
Notes to the preliminary financial results continued
The going concern assessment is based on forecasts to the end of
March 2025, which exceeds the required period of assessment of at
least 12 months in order to be aligned to the Group's interim
reporting date, and uses the same forecasts considered by the Group
for the purposes of the Viability Statement. The assessment
considers a severe downside scenario, reflecting the following key
assumptions:
-- Reducing PRS occupancy to 92% by 31 March 2025
-- Contraction in rental levels of 3.75% per annum
-- Reducing property valuations by 17.5% by 31 March 2025,
driven by either yield expansion or house price deflation
-- 20% development cost inflation
-- Operating cost inflation of 20% per annum
-- An increase in SONIA rate of 5% from 1 October 2023
The Group's forecasts incorporate the likely impact of climate
change and sustainability requirements including costs to deliver
our climate related targets. This includes EPC upgrades across the
portfolio and investing in energy efficient solutions for central
heating systems.
No new financing is assumed in the assessment period, but
existing facilities are assumed to remain available. Even in this
severe downside scenario, the Group has sufficient cash reserves,
with the loan-to-value covenant remaining no higher than 55%
(facility maximum covenant ranges between 70% - 75%) and interest
cover above 2.94x (facility minimum covenant ranges between 1.35x -
1.75x) for the period to March 2025 to align with reporting
periods, which covers the required period of at least 12 months
from the date of authorisation of these financial statements.
Based on these considerations, together with available market
information and the Directors' experience of the Group's property
portfolio and markets, the Directors continue to adopt the going
concern basis in preparing the accounts for the year ended 30
September 2023.
1f Forward-looking statement
Certain statements in this preliminary announcement are
forward-looking. Although the Group believes that the expectations
reflected in these forward-looking statements are reasonable, we
can give no assurance that these expectations will prove to have
been correct.
Because these statements involve risks and uncertainties, actual
results may differ materially from those expressed or implied by
these forward-looking statements. We undertake no obligation to
update any forward-looking statements whether as a result of new
information, future events or otherwise.
Notes to the preliminary financial results continued
2. Analysis of profit before tax
The table below details adjusted earnings, which is one of
Grainger's key performance indicators. The metric is utilised as a
key measure to aid understanding of the performance of the
continuing business and excludes valuation movements and other
adjustments that are one-off in nature, which do not form part of
the normal ongoing revenue or costs of the business and, either
individually or in aggregate, are material to the reported Group
results.
2023 2022
----------------------------------------------- -----------------------------------------------
Other Adjusted Other Adjusted
GBPm Statutory Valuation adjustments earnings Statutory Valuation adjustments earnings
----------------------- ---------- ---------- ------------ --------- ---------- ---------- ------------ -----------
Group revenue 267.1 - - 267.1 279.2 - - 279.2
----------------------- ---------- ---------- ------------ --------- ---------- ---------- ------------ -----------
Net rental income 96.5 - - 96.5 86.3 - - 86.3
Profit on disposal
of trading property 54.8 (0.3) - 54.5 64.4 (0.8) - 63.6
Profit on disposal
of investment
property 3.3 - - 3.3 1.7 - - 1.7
Income from financial
interest in property
assets 4.6 0.1 - 4.7 6.0 (1.2) - 4.8
Fees and other income 5.0 - - 5.0 4.4 - - 4.4
Administrative
expenses (33.5) - - (33.5) (31.8) - - (31.8)
Other expenses (1.2) - - (1.2) (10.3) - 9.5 (0.8)
Goodwill impairment (0.1) 0.1 - - - - - -
(Impairment)/reversal
of impairment of
inventories to net
realisable value (1.0) 1.0 - - 1.5 (1.5) - -
Operating profit 128.4 0.9 - 129.3 122.2 (3.5) 9.5 128.2
Net valuation
(losses)/gains
on investment
property (68.8) 68.8 - - 129.0 (129.0) - -
Net valuation gains
on investment
property
reclassifications - - - - 81.2 (81.2) - -
Change in fair value
of derivatives - - - - - - - -
Finance costs (34.0) - - (34.0) (34.6) - - (34.6)
Finance income 2.2 - - 2.2 1.3 - - 1.3
Share of (loss)/profit
of associates after
tax (0.1) 0.5 - 0.4 1.2 (0.9) - 0.3
Share of loss of
joint ventures after
tax (0.3) - - (0.3) (1.7) - - (1.7)
----------------------- ---------- ---------- ------------ --------- ---------- ---------- ------------ -----------
Profit before tax 27.4 70.2 - 97.6 298.6 (214.6) 9.5 93.5
Tax charge (1.8) (69.2)
----------------------- ---------- ---------- ------------ --------- ---------- ---------- ------------ -----------
Profit for the year
attributable to the
owners of the Company 25.6 229.4
----------------------- ---------- ---------- ------------ --------- ---------- ---------- ------------ -----------
Basic adjusted
earnings
per share 10.3p 10.2p
----------------------- ---------- ---------- ------------ --------- ---------- ---------- ------------ -----------
Diluted adjusted
earnings per share 10.3p 10.2p
----------------------- ---------- ---------- ------------ --------- ---------- ---------- ------------ -----------
Profit before tax in the adjusted columns above of GBP97.6m
(2022: GBP93.5m) is the adjusted earnings of the Group. Adjusted
earnings per share assumes tax of GBP21.5m (2022: GBP17.8m) in line
with the standard rate of UK Corporation Tax of 22.0% (2022:
19.0%), divided by the weighted average number of shares as shown
in Note 9. The Group's IFRS statutory earnings per share is also
detailed in Note 9. The classification of amounts as other
adjustments is a judgement made by management and is a matter
referred to the Audit Committee for approval. There were no other
adjustments in the current year. In 2022, the GBP9.5m cost within
other adjustments comprises fire safety expenses including remedial
work in respect of legacy assets. These transactions do not form
part of the Group's ongoing activities and, as such, have been
classified as other adjustments.
Notes to the preliminary financial results continued
3. Segmental Information
IFRS 8, Operating Segments requires operating segments to be
identified based upon the Group's internal reporting to the Chief
Operating Decision Maker ('CODM') so that the CODM can make
decisions about resources to be allocated to segments and assess
their performance. The Group's CODM are the Executive
Directors.
The two significant segments for the Group are PRS and
Reversionary. The PRS segment includes stabilised PRS assets as
well as PRS under construction due to direct development and
forward funding arrangements, both for wholly-owned assets and the
Group's interest in joint ventures and associates as relevant. The
Reversionary segment includes regulated tenancies, as well as
CHARM. The Other segment includes legacy strategic land and
development arrangements, along with administrative expenses.
The key operating performance measure of profit or loss used by
the CODM is adjusted earnings before tax, valuation and other
adjustments.
The principal net asset value (NAV) measure reviewed by the CODM
is EPRA NTA which is considered to become the most relevant, and
therefore the primary NAV measure for the Group. EPRA NTA reflects
the tax that will crystallise in relation to the trading portfolio,
whilst excluding the volatility of mark to market movements on
fixed rate debt and derivatives which are unlikely to be realised.
Other NAV measures include EPRA NRV and EPRA NDV which we report
alongside EPRA NTA.
Information relating to the Group's operating segments is set
out in the tables below. The tables distinguish between adjusted
earnings, valuation movements and other adjustments and should be
read in conjunction with Note 2.
2023 Income statement
GBPm PRS Reversionary Other Total
---------------------------------------- ------- ------------- ------- -------
Group revenue 121.5 123.9 21.7 267.1
Segment revenue - external
---------------------------------------- ------- ------------- ------- -------
Net rental income 82.2 13.4 0.9 96.5
Profit on disposal of trading property (0.5) 54.2 0.8 54.5
Profit on disposal of investment
property 3.3 - - 3.3
Income from financial interest
in property assets - 4.7 - 4.7
Fees and other income 4.6 - 0.4 5.0
Administrative expenses - - (33.5) (33.5)
Other expenses (1.2) - - (1.2)
Net finance costs (24.9) (6.3) (0.6) (31.8)
Share of trading profit of joint
ventures and associates after tax 0.1 - - 0.1
---------------------------------------- ------- ------------- ------- -------
Adjusted earnings 63.6 66.0 (32.0) 97.6
Valuation movements (70.1) (0.1) - (70.2)
Other adjustments - - - -
---------------------------------------- ------- ------------- ------- -------
Profit before tax (6.5) 65.9 (32.0) 27.4
---------------------------------------- ------- ------------- ------- -------
A reconciliation from adjusted earnings to EPRA earnings is
detailed in the table below, with further details shown in the EPRA
performance measures section at the end of this document:
GBPm PRS Reversionary Other Total
---------------------------------------- ------ ------------- ------- -------
Adjusted earnings 63.6 66.0 (32.0) 97.6
Profit on disposal of trading property 0.5 (54.2) (0.8) (54.5)
Profit on disposal of investment
property (3.3) - - (3.3)
---------------------------------------- ------ ------------- ------- -------
EPRA earnings 60.8 11.8 (32.8) 39.8
---------------------------------------- ------ ------------- ------- -------
Notes to the preliminary financial results continued
2022 Income statement
GBPm PRS Reversionary Other Total
---------------------------------------- ------- ------------- ------- -------
Group revenue 103.2 150.5 25.5 279.2
Segment revenue - external
---------------------------------------- ------- ------------- ------- -------
Net rental income 70.8 15.2 0.3 86.3
Profit on disposal of trading property (0.1) 61.7 2.0 63.6
Profit on disposal of investment
property 1.6 0.1 - 1.7
Income from financial interest
in property assets - 4.8 - 4.8
Fees and other income 3.8 - 0.6 4.4
Administrative expenses - - (31.8) (31.8)
Other expenses (0.8) - - (0.8)
Net finance costs (24.7) (7.8) (0.8) (33.3)
Share of trading loss of joint
ventures and associates after tax (1.4) - - (1.4)
---------------------------------------- ------- ------------- ------- -------
Adjusted earnings 49.2 74.0 (29.7) 93.5
Valuation movements 133.6 (0.2) - 133.4
Valuation movements on investment
property reclassifications 81.2 - - 81.2
Other adjustments - - (9.5) (9.5)
---------------------------------------- ------- ------------- ------- -------
Profit before tax 264.0 73.8 (39.2) 298.6
---------------------------------------- ------- ------------- ------- -------
A reconciliation from adjusted earnings to EPRA earnings is
detailed in the table below:
GBPm PRS Reversionary Other Total
---------------------------------------- ------ ------------- ------- -------
Adjusted earnings 49.2 74.0 (29.7) 93.5
Profit on disposal of trading property 0.1 (61.7) (2.0) (63.6)
Profit on disposal of investment
property (1.6) (0.1) - (1.7)
---------------------------------------- ------ ------------- ------- -------
EPRA earnings 47.7 12.2 (31.7) 28.2
---------------------------------------- ------ ------------- ------- -------
Segmental assets
The principal net asset value measures reviewed by the CODM are
EPRA NRV, EPRA NTA and EPRA NDV. These measures reflect the current
market value of trading property owned by the Group rather than the
lower of historical cost and net realisable value. These measures
are considered to be a more relevant reflection of the value of the
assets owned by the Group.
EPRA NRV is the Group's statutory net assets plus the adjustment
required to increase the value of trading stock from its statutory
accounts value of the lower of cost and net realisable value to its
market value. In addition, the statutory statement of financial
position amounts for both deferred tax on property revaluations and
derivative financial instruments net of deferred tax, including
those in joint ventures and associates, are added back to statutory
net assets. Finally, the market value of Grainger plc shares owned
by the Group are added back to statutory net assets.
EPRA NTA assumes that entities buy and sell assets, thereby
crystallising certain levels of deferred tax liabilities. For the
Group, deferred tax in relation to revaluations of its trading
portfolio is taken into account by applying the expected rate of
tax to the adjustment that increases the value of trading stock
from its statutory accounts value of the lower of cost and net
realisable value, to its market value. The measure also excludes
all intangible assets on the statutory balance sheet, including
goodwill.
EPRA NDV reverses some of the adjustments made between statutory
net assets, EPRA NRV and EPRA NTA. All of the adjustments for the
value of derivative financial instruments net of deferred tax,
including those in joint ventures and associates, are reversed. The
adjustment for the deferred tax on investment property revaluations
excluded from EPRA NRV and EPRA NTA are also reversed, as is the
intangible adjustment in respect of EPRA NTA, except for goodwill
which remains excluded. In addition, adjustments are made to net
assets to reflect the fair value, net of deferred tax, of the
Group's fixed rate debt.
Notes to the preliminary financial results continued
Total Accounting Return (NTA basis) of -1.8% is calculated from
the closing EPRA NTA of 305p per share plus the dividend of 6.65p
per share for the year, divided by the opening EPRA NTA of 317p per
share.
These measures are set out below by segment along with a
reconciliation to the summarised statutory statement of financial
position:
2023 Segment net assets
PRS Reversionary Other Total Pence
GBPm per share
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(statutory) 1,729.8 151.7 47.1 1,928.6 260
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(EPRA NRV) 1,839.3 476.9 43.1 2,359.3 318
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(EPRA NTA) 1,835.1 395.0 37.4 2,267.5 305
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(EPRA NDV) 1,729.2 395.0 208.7 2,332.9 314
-------------------------- -------- ------------- ------ -------- -----------
2023 Reconciliation of EPRA NAV measures
Adjustments Adjustments
Adjustments to deferred to
to market and contingent derivatives,
value, EPRA tax and fixed EPRA
Statutory deferred NRV intangibles EPRA rate debt NDV
balance tax and balance NTA balance and balance
GBPm sheet derivatives sheet sheet intangibles sheet
------------------ ---------- ------------- ---------- --------------- ------------- --------------- ----------
Investment
property 2,948.9 - 2,948.9 - 2,948.9 - 2,948.9
Investment
in joint
ventures
and associates 91.0 - 91.0 - 91.0 - 91.0
Financial
interest
in property
assets 67.0 - 67.0 - 67.0 - 67.0
Inventories
- trading
property 392.2 342.1 734.3 - 734.3 - 734.3
Cash and cash
equivalents 121.0 - 121.0 - 121.0 - 121.0
Other assets 102.2 (33.7) 68.5 (1.0) 67.5 45.9 113.4
------------------ ---------- ------------- ---------- --------------- ------------- --------------- ----------
Total assets 3,722.3 308.4 4,030.7 (1.0) 4,029.7 45.9 4,075.6
------------------ ---------- ------------- ---------- --------------- ------------- --------------- ----------
Interest-bearing
loans and
borrowings (1,533.5) - (1,533.5) - (1,533.5) 182.1 (1,351.4)
Deferred and
contingent
tax liabilities (122.3) 122.3 - (90.8) (90.8) (162.6) (253.4)
Other liabilities (137.9) - (137.9) - (137.9) - (137.9)
------------------ ---------- ------------- ---------- --------------- ------------- --------------- ----------
Total liabilities (1,793.7) 122.3 (1,671.4) (90.8) (1,762.2) 19.5 (1,742.7)
------------------ ---------- ------------- ---------- --------------- ------------- --------------- ----------
Net assets 1,928.6 430.7 2,359.3 (91.8) 2,267.5 65.4 2,332.9
------------------ ---------- ------------- ---------- --------------- ------------- --------------- ----------
2022 Segment net assets
PRS Reversionary Other Total Pence
GBPm per share
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(statutory) 1,711.7 190.7 64.4 1,966.8 265p
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(EPRA NRV) 1,833.0 584.9 52.7 2,470.6 333p
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(EPRA NTA) 1,827.6 485.6 45.8 2,359.0 317p
-------------------------- -------- ------------- ------ -------- -----------
Total segment net assets
(EPRA NDV) 1,712.0 485.6 285.4 2,483.0 334p
-------------------------- -------- ------------- ------ -------- -----------
Notes to the preliminary financial results continued
2022 Reconciliation of EPRA NAV measures
Adjustments
to
Adjustments Adjustments derivatives
to market to deferred ,
value, and fixed
Statutory deferred EPRA NRV contingent EPRA rate debt EPRA NDV
balance tax and balance tax and NTA balance and balance
GBPm sheet derivatives sheet intangibles sheet intangibles sheet
------------------ ------------ ------------- ------------ ------------ ------------- ------------ ------------
Investment
property 2,775.9 - 2,775.9 - 2,775.9 - 2,775.9
Investment
in joint
ventures
and associates 55.2 - 55.2 - 55.2 - 55.2
Financial
interest
in property
assets 69.1 - 69.1 - 69.1 - 69.1
Inventories
- trading
property 453.8 419.2 873.0 - 873.0 - 873.0
Cash and
cash equivalents 95.9 - 95.9 - 95.9 - 95.9
Other assets 129.2 (51.4) 77.8 (0.5) 77.3 56.5 133.8
------------------ ------------ ------------- ------------ ------------ ------------- ------------ ------------
Total assets 3,579.1 367.8 3,946.9 (0.5) 3,946.4 56.5 4,002.9
------------------ ------------ ------------- ------------ ------------ ------------- ------------ ------------
Interest-bearing
loans and
borrowings (1,357.6) - (1,357.6) - (1,357.6) 263.0 (1,094.6)
Deferred
and contingent
tax liabilities (136.9) 136.0 (0.9) (111.1) (112.0) (195.5) (307.5)
Other liabilities (117.8) - (117.8) - (117.8) - (117.8)
------------------ ------------ ------------- ------------ ------------ ------------- ------------ ------------
Total liabilities (1,612.3) 136.0 (1,476.3) (111.1) (1,587.4) 67.5 (1,519.9)
------------------ ------------ ------------- ------------ ------------ ------------- ------------ ------------
Net assets 1,966.8 503.8 2,470.6 (111.6) 2,359.0 124.0 2,483.0
------------------ ------------ ------------- ------------ ------------ ------------- ------------ ------------
4. Group revenue
2023 2022
GBPm GBPm
-------------------------------------------------- ------ ------
Gross rental income (Note 5) 133.7 121.4
Gross proceeds from disposal of trading property
(Note 6) 128.4 153.4
Fees and other income (Note 8) 5.0 4.4
-------------------------------------------------- ------ ------
267.1 279.2
-------------------------------------------------- ------ ------
5. Net rental income
2023 2022
GBPm GBPm
----------------------------- ------- -------
Gross rental income 133.7 121.4
Property operating expenses (37.2) (35.1)
----------------------------- ------- -------
96.5 86.3
----------------------------- ------- -------
Notes to the preliminary financial results continued
6. Profit on disposal of trading property
2023 2022
GBPm GBPm
-------------------------------------------------- ------- -------
Gross proceeds from disposal of trading property 128.4 153.4
Selling costs (2.8) (4.0)
-------------------------------------------------- ------- -------
Net proceeds from disposal of trading property 125.6 149.4
Carrying value of trading property sold (Note
12) (70.8) (85.0)
54.8 64.4
-------------------------------------------------- ------- -------
7. Profit on disposal of investment property
2023 2022
GBPm GBPm
----------------------------------------------------- ------- -------
Gross proceeds from disposal of investment property 65.3 21.3
Selling costs (1.8) (0.4)
----------------------------------------------------- ------- -------
Net proceeds from disposal of investment property 63.5 20.9
Carrying value of investment property sold (Note
11) (60.2) (19.2)
----------------------------------------------------- ------- -------
3.3 1.7
----------------------------------------------------- ------- -------
8. Fees and other income
2023 2022
GBPm GBPm
------------------------------------------ ------ ------
Property and asset management fee income 3.2 2.7
Other sundry income 1.8 1.7
------------------------------------------ ------ ------
5.0 4.4
------------------------------------------ ------ ------
Included within other sundry income in the current year is
GBP1.6m (2022: GBP1.1m) liquidated and ascertained damages ('LADs')
recorded to compensate the Group for lost rental income resulting
from the delayed completion of construction contracts.
9. Earnings per share
Basic
Basic earnings per share is calculated by dividing the profit or
loss attributable to the owners of the Company by the weighted
average number of ordinary shares in issue during the year,
excluding ordinary shares purchased by the Group and held both in
Trust and as treasury shares to meet its obligations under the
Long-Term Incentive Plan ('LTIP') and Deferred Bonus Plan ('DBP'),
on which the dividends are being waived.
Diluted
Diluted earnings per share is calculated by adjusting the
weighted average number of shares in issue by the dilutive effect
of ordinary shares that the Company may potentially issue relating
to its share option schemes and contingent share awards under the
LTIP and DBP, based upon the number of shares that would be issued
if 30 September 2023 was the end of the contingency period. Where
the effect of the above adjustments is antidilutive, they are
excluded from the calculation of diluted earnings per share.
Notes to the preliminary financial results continued
30 September 2023 30 September 2022
-------------------------------- --------------------------------
Profit Weighted Profit Weighted
for average Earnings for average Earnings
the number per the number per
year of shares share year of shares share
GBPm (millions) (pence) GBPm (millions) (pence)
------------------------------ ------- ------------ --------- ------- ------------ ---------
Basic earnings per share
Profit attributable to
equity holders 25.6 739.9 3.5 229.4 740.5 31.0
Effect of potentially
dilutive securities
Share options and contingent
shares - 2.5 - - 2.6 (0.1)
------------------------------ ------- ------------ --------- ------- ------------ ---------
Diluted earnings per
share
Profit attributable to
equity holders 25.6 742.4 3.5 229.4 743.1 30.9
------------------------------ ------- ------------ --------- ------- ------------ ---------
10. Dividends
Subject to approval at the AGM, the final dividend of 4.37p per
share (gross) amounting to GBP32.2m will be paid on 14 February
2024 to Shareholders on the register at the close of business on 29
December 2023. Shareholders will again be offered the option to
participate in a dividend reinvestment plan and the last day for
election is 24 January 2024. An interim dividend of 2.28p per share
amounting to a total of GBP16.9m was paid to Shareholders on 3 July
2023.
11. Investment property
2023 2022
GBPm GBPm
-------------------------------------------------------------- -------- --------
Opening balance 2,775.9 2,179.2
-------------------------------------------------------------- -------- --------
Acquisitions 9.8 14.4
Capital expenditure - completed assets 20.4 9.2
Capital expenditure - assets under construction 271.8 265.6
-------------------------------------------------------------- -------- --------
Total additions 302.0 289.2
Transfer from inventories (Note 1c) - 116.5
Disposals (Note 7) (60.2) (19.2)
Net valuation (losses)/gains on investment properties (68.8) 129.0
Net valuation gains on investment property reclassifications
(Note 1c) - 81.2
-------------------------------------------------------------- -------- --------
Closing balance 2,948.9 2,775.9
-------------------------------------------------------------- -------- --------
12. Inventories - trading property
2023 2022
GBPm GBPm
---------------------------------------------------- ------- --------
Opening balance 453.8 595.2
Additions 10.2 58.6
Transfer to investment property (Note 1c) - (116.5)
Disposals (Note 6) (70.8) (85.0)
(Impairment)/reversal of impairment of inventories
to net realisable value (1.0) 1.5
---------------------------------------------------- ------- --------
Closing balance 392.2 453.8
---------------------------------------------------- ------- --------
Notes to the preliminary financial results continued
13. Investment in associates
2023 2022
GBPm GBPm
------------------------------------- ------ ------
Opening balance 16.7 15.5
Share of (loss)/profit for the year (0.1) 1.2
Dividends paid in the year (0.8) -
Closing balance 15.8 16.7
------------------------------------- ------ ------
The closing balance comprises share of net assets of GBP1.2m
(2022: GBP2.1m) and net loans due from associates of GBP14.6m
(2022: GBP14.6m). At the balance sheet date, there is no
expectation of credit losses on loans due.
As at 30 September 2023, the Group's interest in active
associates was as follows:
% of ordinary Country of Accounting
share capital incorporation period end
held
--------- --------------- --------------- -------------
Vesta LP 20.0 UK 30 September
--------- --------------- --------------- -------------
14. Investment in joint ventures
2023 2022
GBPm GBPm
---------------------------------- ------ ------
Opening balance 38.5 29.4
Share of loss for the year (0.3) (1.7)
Further investment(1) 34.0 6.4
Loans advanced to joint ventures 3.0 4.4
Closing balance 75.2 38.5
---------------------------------- ------ ------
(1) Grainger invested GBP34.0m into Connected Living London
(BTR) Limited in the year (2022: GBP6.4m).
The closing balance comprises share of net assets of GBP46.9m
(2022: GBP13.2m) and net loans due from joint ventures of GBP28.3m
(2022: GBP25.3m). At the balance date, there is no expectation of
credit losses on loans due.
At 30 September 2023, the Group's interest in active joint
ventures was as follows:
% of ordinary Accounting
share capital Country period
held of incorporation end
------------------------------ --------------- ------------------ -------------
Connected Living London (BTR) 30 September
Limited 51 UK
Curzon Park Limited 50 UK 31 March
Lewisham Grainger Holdings 30 September
LLP 50 UK
------------------------------ --------------- ------------------ -------------
15. Financial interest in property assets ('CHARM'
portfolio)
2023 2022
GBPm GBPm
----------------------------------- ------ ------
Opening balance 69.1 71.7
Cash received from the instrument (6.7) (8.6)
Amounts taken to income statement 4.6 6.0
Closing balance 67.0 69.1
----------------------------------- ------ ------
Notes to the preliminary financial results continued
The CHARM portfolio is a financial interest in equity mortgages
held by the Church of England Pensions Board as mortgagee. It is
accounted for under IFRS 9 and is measured at fair value through
profit and loss.
It is considered to be a Level 3 financial asset as defined by
IFRS 13. The financial asset is included in the fair value
hierarchy within Note 19.
16. Trade and other receivables
2023 2022
GBPm GBPm
----------------------------------------- ------ ------
Rent and other tenant receivables 3.0 4.7
Deduct: Provision for impairment (1.5) (1.5)
----------------------------------------- ------ ------
Rent and other tenant receivables - net 1.5 3.2
Contract assets - 1.9
Restricted deposits 10.2 14.3
Other receivables 17.9 17.1
Prepayments 4.4 4.0
----------------------------------------- ------ ------
Closing balance 34.0 40.5
----------------------------------------- ------ ------
The Group's assessment of expected credit losses involves
estimation given its forward-looking nature. This is not considered
to be an area of significant judgement or estimation due to the
balance of gross rent and other tenant receivables of GBP3.0m
(2022: GBP4.7m). Assumptions used in the forward-looking assessment
are continually reviewed to take into account likely rent
deferrals.
At the balance sheet date, there is no expectation of any
material credit losses on contract assets.
Restricted deposits arise from contracts with third parties that
place restrictions on use of funds and cannot be accessed. These
deposits are held in connection with facility arrangements and are
released by the lender on a quarterly basis once covenant
compliance has been met.
The fair values of trade and other receivables are considered to
be equal to their carrying amounts.
17. Trade and other payables
2023 2022
GBPm GBPm
-------------------------------- ------ ------
Current liabilities
Deposits received 10.7 10.1
Trade payables 15.9 22.8
Lease liabilities 0.2 0.8
Tax and social security costs 3.0 0.7
Accruals 81.9 63.8
Deferred income 9.0 7.7
-------------------------------- ------ ------
120.7 105.9
-------------------------------- ------ ------
Non-current liabilities
Lease liabilities 6.9 2.2
-------------------------------- ------ ------
6.9 2.2
-------------------------------- ------ ------
Total trade and other payables 127.6 108.1
-------------------------------- ------ ------
Within accruals, GBP60.2m comprises accrued expenditure in
respect of ongoing construction activities (2022: GBP43.0m).
Notes to the preliminary financial results continued
18. Provisions for other liabilities and charges
2023 2022
GBPm GBPm
---------------------------------------------------------- ------ ------
Current provisions for other liabilities and charges
Opening balance 8.6 0.2
Additions 0.3 8.7
Utilisation (0.3) (0.3)
8.6 8.6
---------------------------------------------------------- ------ ------
Non-current provisions for other liabilities and charges
Opening balance 1.1 1.1
1.1 1.1
---------------------------------------------------------- ------ ------
Total provisions for other liabilities and charges 9.7 9.7
---------------------------------------------------------- ------ ------
Within current provisions, GBP8.6m (2022: GBP8.6m) has been
provided for potential fire safety remediation costs relating to a
small number of legacy properties that Grainger historically had an
involvement in developing and may require fire safety related
remediation works. Where appropriate, the Group is seeking
recoveries from contractors and insurers which may reduce the
overall liability over time.
19. Interest-bearing loans and borrowings and financial risk
management
2023 2022
GBPm GBPm
-------------------------------- -------- --------
Current liabilities
Bank loans - Pounds sterling - 40.0
- 40.0
Non-current liabilities
Bank loans - Pounds sterling 490.1 275.2
Bank loans - Euro 0.9 0.9
Non-bank financial institution 347.3 347.2
Corporate bond 695.2 694.3
-------------------------------- -------- --------
1,533.5 1,317.6
-------------------------------- -------- --------
Closing balance 1,533.5 1,357.6
-------------------------------- -------- --------
The above analyses of loans and borrowings are net of
unamortised loan issue costs and the discount on issuance of the
corporate bond. As at 30 September 2023, unamortised costs totalled
GBP13.8m (2022: GBP14.4m) and the outstanding discount was GBP1.9m
(2022: GBP2.2m).
Categories of financial instrument
The Group holds financial instruments such as financial interest
in property assets, trade and other receivables (excluding
prepayments), derivatives, cash and cash equivalents. For all
assets and liabilities excluding interest-bearing loans the book
value was the same as the fair value as at 30 September 2023 and as
at 30 September 2022.
As at 30 September 2023, the fair value of interest-bearing
loans is lower than the book value by GBP291.6m (2022: GBP263.1m
greater than book value), but there is no requirement under IFRS 9
to adjust the carrying value of loans, all of which are stated at
unamortised cost in the consolidated statement of financial
position.
Notes to the preliminary financial results continued
Market risk
The Group is exposed to market risk through interest rates, the
availability of credit and house price movements relating to the
Tricomm Housing portfolio and the CHARM portfolio. The Group is not
significantly exposed to equity price risk or to commodity price
risk.
Fair values
IFRS 13 sets out a three-tier hierarchy for financial assets and
liabilities valued at fair value. These are as follows:
Level 1 - quoted prices (unadjusted) in active markets for
identical assets and liabilities;
Level 2 - inputs other than quoted prices included in Level 1
that are observable for the asset or liability, either directly or
indirectly; and
Level 3 - unobservable inputs for the asset or liability.
The following table presents the Group's assets and liabilities
that are measured at fair value:
2023 2022
---------------------- ----------------------
Assets Liabilities Assets Liabilities
GBPm GBPm GBPm GBPm
------------------------------------------------------------------- -------- ------------ -------- ------------
Level 3
------------------------------------------------------------------- -------- ------------ -------- ------------
CHARM 67.0 - 69.1 -
Investment property 2,948.9 - 2,775.9 -
------------------------------------------------------------------- -------- ------------ -------- ------------
3,015.9 - 2,845.0 -
------------------------------------------------------------------- -------- ------------ -------- ------------
Level 2
------------------------------------------------------------------- -------- ------------ -------- ------------
Interest rate swaps - in cash flow hedge accounting relationships 45.3 - 56.5 -
45.3 - 56.5 -
------------------------------------------------------------------- -------- ------------ -------- ------------
The significant unobservable inputs affecting the carrying value
of the CHARM portfolio are house price inflation and discount
rates. A reconciliation of movements and amounts recognised in the
consolidated income statement are detailed in Note 15.
The investment valuations provided by Allsop LLP and CBRE
Limited are based on RIC's Professional Valuation Standards, but
include a number of unobservable inputs and other valuation
assumptions.
The fair value of swaps and caps were valued in-house by a
specialised treasury management system, using first a discounted
cash flow model and market information. The fair value is derived
from the present value of future cash flows discounted at rates
obtained by means of the current yield curve appropriate for those
instruments. As all significant inputs required to value the swaps
and caps are observable, they fall within Level 2.
The reconciliation between opening and closing balances for
Level 3 is detailed in the table below:
2023 2022
Assets - Level 3 GBPm GBPm
----------------------------------- -------- --------
Opening balance 2,845.0 2,250.9
Amounts taken to income statement (64.2) 216.2
Other movements 235.1 377.9
----------------------------------- -------- --------
Closing balance 3,015.9 2,845.0
----------------------------------- -------- --------
Notes to the preliminary financial results continued
20. Tax
The tax charge for the year of GBP1.8m (2022: GBP69.2m)
recognised in the consolidated income statement comprises:
2023 2022
GBPm GBPm
--------------------------------------------------- ------- ------
Current tax
Corporation tax on profit 18.9 17.8
Adjustments relating to prior years (4.3) (5.2)
--------------------------------------------------- ------- ------
14.6 12.6
--------------------------------------------------- ------- ------
Deferred tax
Origination and reversal of temporary differences (14.2) 51.7
Adjustments relating to prior years 1.4 4.9
(12.8) 56.6
--------------------------------------------------- ------- ------
Total tax charge for the year 1.8 69.2
--------------------------------------------------- ------- ------
The 2023 current tax adjustments relating to prior years reflect
adjustments which have been included in submitted tax returns and
represent movements between deferred and current tax in relation to
investment properties and capital allowances.
The Group works in an open and transparent manner and maintains
a regular dialogue with HM Revenue & Customs. This approach is
consistent with the 'low risk' rating we have been awarded by HM
Revenue & Customs and to which the Group is committed.
The Group's results for this year are taxed at an effective rate
of 22.0% (2022: 19.0%).
In addition to the above, a deferred tax credit GBP4.3m (2022:
charge of GBP13.3m) was recognised within other comprehensive
income comprising:
2023 2022
GBPm GBPm
------------------------------------------------------------- ------ ------
Remeasurement of BPT Limited defined benefit pension scheme (0.3) 1.4
Fair value movement in cash flow hedges (4.0) 11.9
------------------------------------------------------------- ------ ------
Amounts recognised in other comprehensive income (4.3) 13.3
------------------------------------------------------------- ------ ------
Deferred tax balances comprise temporary differences
attributable to:
2023 2022
GBPm GBPm
---------------------------------------------------------------- -------- --------
Deferred tax assets
Short-term temporary differences 3.7 1.2
3.7 1.2
---------------------------------------------------------------- -------- --------
Deferred tax liabilities
Trading property uplift to fair value on business combinations (5.2) (6.3)
Investment property revaluation (95.2) (108.9)
Short-term temporary differences (13.2) (8.6)
Fair value movement in financial interest in property assets (1.1) (1.2)
Actuarial gain on BPT Limited defined benefit pension scheme (0.9) (1.2)
Fair value movement in derivative financial instruments (6.7) (10.7)
(122.3) (136.9)
---------------------------------------------------------------- -------- --------
Total deferred tax (118.6) (135.7)
---------------------------------------------------------------- -------- --------
Notes to the preliminary financial results continued
Deferred tax has been calculated at a rate of 25.0% (2022:
25.0%) in line with the enacted main rate of corporation tax
applicable from 1 April 2023.
In addition to the tax amounts shown above, contingent tax based
on EPRA market value measures, being tax on the difference between
the carrying value of trading properties in the consolidated
statement of financial position and their market value has not been
recognised by the Group. This contingent tax amounts to GBP85.5m,
calculated at 25.0% (2022: GBP104.8m, calculated at 25.0%) and will
be realised as the properties are sold.
21. Retirement benefits
The Group retirement benefit asset decreased from GBP9.8m to
GBP9.6m in the year ended 30 September 2023. This movement has
arisen from GBP0.3m company contributions and GBP0.6m net interest
income, offset by a GBP0.8m loss on plan assets, as well as losses
due to changes in assumptions of GBP0.3m (primarily market
observable discount rates and inflationary expectations). The
principal actuarial assumptions used to reflect market conditions
as at 30 September 2023 are as follows:
2023 2022
% %
------------------------------------------ ------ -----
Discount rate 5.6 5.0
Retail Price Index (RPI) inflation 3.5 3.8
Consumer Price Index (CPI) inflation 2.8 3.0
Salary increases 4.0 4.3
Rate of increase of pensions in payment 5.0 5.0
Rate of increase for deferred pensioners 2.8 3.0
------------------------------------------ ------ -----
22. Share-based payments
The Group operates a number of equity-settled, share-based
compensation plan comprising awards under a Long-Term Incentive
Plan ('LTIP'), a Deferred Bonus Plan ('DBP'), a Share Incentive
Plan ('SIP') and a Save As You Earn Scheme ('SAYE'). The
share-based payments charge recognised in the consolidated income
statement for the period is GBP2.4m (2022: GBP1.7m).
23. Related party transactions
During the year ended 30 September 2023, the Group transacted
with its associates and joint ventures (details of which are set
out in Notes 13 and 14). The Group provides a number of services to
its associates and joint ventures. These include property and asset
management services for which the Group receives fee income. The
related party transactions recognised in the consolidated income
statement and consolidated statement of financial position are as
follows:
2023 2022
----------------------- -----------------------
Year
Fees end Fees Year end
recognised balance recognised balance
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------- ------------ --------- ------------ ---------
Connected Living London
(BTR) Limited 1,455 480 1,303 596
Lewisham Grainger Holdings
LLP 307 368 319 -
Vesta Limited Partnership 838 227 743 207
---------------------------- ------------ --------- ------------ ---------
2,600 1,075 2,365 803
---------------------------- ------------ --------- ------------ ---------
Notes to the preliminary financial results continued
2023 2022
--------------------------------------- ---------------------------------------
Interest Year end loan Interest Interest Year end loan Interest
recognised balance rate recognised balance rate
GBP'000 GBPm % GBP'000 GBPm %
-------------------------------- ------------ -------------- --------- ------------ -------------- ---------
Curzon Park Limited - 18.1 Nil - 18.1 Nil
Lewisham Grainger Holdings LLP 871 10.2 11.2 692 7.2 6.9
Vesta LP - 14.6 Nil - 14.6 Nil
-------------------------------- ------------ -------------- --------- ------------ -------------- ---------
871 42.9 692 39.9
-------------------------------- ------------ -------------- --------- ------------ -------------- ---------
EPRA Performance Measures - Unaudited
The European Public Real Estate Association (EPRA) is the body
that represents Europe's listed property companies. The association
sets out guidelines and recommendations to facilitate consistency
in listed real estate reporting, in turn allowing stakeholders to
compare companies on a like-for-like basis. As a member of EPRA,
the Group is supportive of EPRA's initiatives and discloses
measures in relation to the EPRA Best Practices Recommendations
('EPRA BPR') guidelines. The most recent guidelines, updated in
February 2022, have been adopted by the Group.
EPRA Earnings
2023 2022
---------------------------- ---------------------------
Pence Pence
Earnings Shares per Earnings Shares per
GBPm millions share GBPm millions share
--------------------------------------- --------- --------- ------ -------- --------- ------
Earnings per IFRS income statement 27.4 742.4 3.7 298.6 743.1 40.1
Adjustments to calculate adjusted
EPRA Earnings, exclude:
i) Changes in value of investment
properties, development properties
held for investment and other
interests 68.9 - 9.3 (211.4) - (28.4)
ii) Profits or losses on disposal
of investment properties, development
properties held for investment
and other interests (3.3) - (0.4) (1.7) - (0.2)
iii) Profits or losses on sales
of trading properties including
impairment charges in respect
of trading properties (53.8) - (7.3) (65.9) - (8.9)
iv) Tax on profits or losses on
disposals - - - - - -
v) Negative goodwill/goodwill
impairment 0.1 - - - - -
vi) Changes in fair value of financial
instruments and associated close-out
costs - - - - - -
vii) Acquisition costs on share
deals and non-controlling joint
venture interests - - - - - -
viii) Deferred tax in respect
of EPRA adjustments - - - - - -
ix) Adjustments i) to viii) in
respect of joint ventures 0.5 - 0.1 (0.9) - (0.1)
x) Non-controlling interests in
respect of the above - - - - - -
xi) Other adjustments in respect
of adjusted earnings - - - 9.5 - 1.3
--------------------------------------- --------- --------- ------ -------- --------- ------
EPRA Earnings/Earnings per share 39.8 742.4 5.4 28.2 743.1 3.8
--------------------------------------- --------- --------- ------ -------- --------- ------
EPRA Earnings per share after
tax 4.2 3.1
--------------------------------------- --------- --------- ------ -------- --------- ------
EPRA Performance Measures - Unaudited (continued)
EPRA NRV, EPRA NTA and EPRA NDV
2023 2022
------------------------- -------------------------
EPRA EPRA EPRA EPRA EPRA EPRA
NRV NTA NDV NRV NTA NDV
GBPm GBPm GBPm GBPm GBPm GBPm
----------------------------------------- ------- ------- ------- ------- ------- -------
IFRS Equity attributable to shareholders 1,928.6 1,928.6 1,928.6 1,966.8 1,966.8 1,966.8
Include/Exclude:
i) Hybrid Instruments - - - - - -
----------------------------------------- ------- ------- ------- ------- ------- -------
Diluted NAV 1,928.6 1,928.6 1,928.6 1,966.8 1,966.8 1,966.8
Include:
ii.a) Revaluation of IP (if IAS
40 cost option is used) - - - - - -
ii.b) Revaluation of IPUC (if IAS
40 cost option is used) - - - - - -
ii.c) Revaluation of other non-current
investments 11.6 11.6 11.6 5.1 5.1 5.1
iii) Revaluation of tenant leases
held as finance leases - - - - - -
iv) Revaluation of trading properties 347.3 256.5 256.5 425.5 314.4 314.4
----------------------------------------- ------- ------- ------- ------- ------- -------
Diluted NAV at Fair Value 2,287.5 2,196.7 2,196.7 2,397.4 2,286.3 2,286.3
Exclude:
v) Deferred tax in relation to fair
value gains of IP 105.8 105.8 - 115.6 115.6 -
vi) Fair value of financial instruments (34.0) (34.0) - (42.4) (42.4) -
vii) Goodwill as a result of deferred
tax - - - - - -
viii.a) Goodwill as per the IFRS
balance sheet - (0.4) (0.4) - (0.5) (0.5)
viii.b) Intangible as per the IFRS
balance sheet - (0.6) - - - -
Include:
ix) Fair value of fixed interest
rate debt - - 136.6 - - 197.2
x) Revalue of intangibles to fair
value - - - - - -
xi) Real estate transfer tax - - - - - -
NAV 2,359.3 2,267.5 2,332.9 2,470.6 2,359.0 2,483.0
Fully diluted number of shares 743.0 743.0 743.0 742.9 742.9 742.9
NAV pence per share 318 305 314 333 317 334
EPRA Performance Measures - Unaudited (continued)
EPRA NIY
2023 2022
GBPm GBPm
Investment property - wholly-owned 2,948.9 2,775.9
Investment property - share of JVs/Funds 65.6 32.4
Trading property (including share of JVs) 734.3 873.0
Less: developments (617.1) (664.8)
Completed property portfolio 3,131.7 3,016.5
Allowance for estimated purchasers' costs 125.2 121.9
Gross up completed property portfolio valuation B 3,256.9 3,138.4
Annualised cash passing rental income 140.1 124.8
Property outgoings (39.1) (33.9)
Annualised net rents A 101.0 90.9
Add: rent incentives 0.3 0.2
'Topped up' net annualised rents C 101.3 91.1
EPRA NIY A/B 3.1% 2.9%
EPRA 'topped up' NIY C/B 3.1% 2.9%
Gross up completed property portfolio valuation 3,256.9 3,138.4
Adjustments to completed property portfolio in respect of regulated tenancies (740.9) (863.8)
Adjusted gross up completed property portfolio valuation b 2,516.0 2,274.6
Annualised net rents 101.0 90.9
Adjustments to annualised cash passing rental income in respect of newly completed developments
and refurbishment activity 11.2 6.6
Adjustments to property outgoings in respect of newly completed developments and refurbishment
activity (3.2) (1.9)
Adjustments to annualised cash passing rental income in respect of regulated tenancies (17.0) (18.9)
Adjustments to property outgoings in respect of regulated tenancies 4.7 5.1
Adjusted annualised net rents a 96.7 81.8
Add: rent incentives 0.3 0.2
EPRA 'topped up' NIY c 97.0 82.0
Adjusted EPRA NIY a/b 3.8% 3.6%
Adjusted EPRA 'topped up' NIY c/b 3.9% 3.6%
EPRA Vacancy Rate
2023 2022
GBPm GBPm
Estimated rental value of vacant space A 1.8 2.0
Estimated rental value of the whole portfolio B 112.7 95.7
EPRA Vacancy Rate A/B 1.6% 2.1%
The vacancy rate reflects estimated rental values of the Group's
stabilised habitable PRS units as at the reporting date.
EPRA Performance Measures - Unaudited (continued)
EPRA Cost Ratio
2023 2022
GBPm GBPm
Administrative expenses 33.5 31.8
Property operating expenses 37.2 35.1
Share of joint ventures expenses (0.1) 1.4
Management fees (3.2) (2.7)
Other operating income/recharges intended to cover overhead expenses (1.8) (1.7)
Exclude:
Investment property depreciation - -
Ground rent costs (0.2) (0.2)
EPRA Costs (including direct vacancy costs) A 65.4 63.7
Direct vacancy costs (2.2) (2.3)
EPRA Costs (excluding direct vacancy costs) B 63.2 61.4
Gross rental income 133.7 121.4
Less: ground rent income (0.6) (0.6)
Add: share of joint ventures (gross rental income less ground rents) 0.8 0.7
Add: adjustment in respect of profits or losses on sales of properties 58.1 66.1
Gross Rental Income and Trading Profits C 192.0 187.6
Adjusted EPRA Cost Ratio (including direct vacancy costs) A/C 34.1% 34.0%
Adjusted EPRA Cost Ratio (excluding direct vacancy costs) B/C 32.9% 32.7%
EPRA LTV
2023
GBPm Group Share of Joint Ventures Share of Associates Combined
Borrowings from Financial Institutions 849.2 - - 849.2
Bond loans 700.0 - - 700.0
Net payables 93.6 6.7 14.6 114.9
Exclude:
Cash and cash equivalents (117.8) (3.5) (0.5) (121.8)
Net debt A 1,525.0 3.2 14.1 1,542.3
Investment properties at fair value 2,433.4 - 15.4 2,448.8
Investment properties under development 515.5 50.3 - 565.8
Properties held for sale 734.3 - - 734.3
Financial assets 109.9 - - 109.9
Total property value B 3,793.1 50.3 15.4 3,858.8
EPRA LTV % A/B 40.2% 6.5% 91.9% 40.0%
EPRA Performance Measures - Unaudited (continued)
2022
GBPm Group Share of Joint Ventures Share of Associates Combined
Borrowings from Financial Institutions 674.2 - - 674.2
Bond loans 700.0 - - 700.0
Net payables 67.6 6.0 14.9 88.5
Exclude:
Cash and cash equivalents (95.4) (2.7) (1.1) (99.2)
Net debt A 1,346.4 3.3 13.8 1,363.5
Investment properties at fair value 2,197.7 - 15.9 2,213.6
Investment properties under development 578.2 16.5 - 594.7
Properties held for sale 873.0 - - 873.0
Financial assets 109.0 - - 109.0
Total property value B 3,757.9 16.5 15.9 3,790.3
EPRA LTV % A/B 35.8% 20.0% 86.8% 36.0%
EPRA Capital Expenditure
2023
Investment Group (excl Joint Share of Joint
GBPm Trading Properties Properties Ventures) Ventures Combined
Acquisitions - 9.8 9.8 - 9.8
Development 5.9 255.9 261.8 33.3 295.1
Completed assets
- Incremental letting - - - - -
space
- No incremental
letting space 2.7 20.4 23.1 - 23.1
- Tenant incentives - - - - -
- Other material
non-allocated types - - - - -
of expenditure
Capitalised interest 1.6 15.9 17.5 0.4 17.9
Total capital
expenditure 10.2 302.0 312.2 33.7 345.9
2022
Investment Group (excl Joint Share of Joint
GBPm Trading Properties Properties Ventures) Ventures Combined
Acquisitions 0.1 14.4 14.5 - 14.5
Development 49.5 253.8 303.3 5.4 308.7
Completed assets
- Incremental -
letting space - - - -
- No incremental
letting space 8.8 9.2 18.0 - 18.0
- Tenant incentives - - - - -
- Other material
non-allocated types -
of expenditure - - - -
Capitalised
interest 0.2 11.8 12.0 0.3 12.3
Total capital
expenditure 58.6 289.2 347.8 5.7 353.5
[1] Centre for Cities
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END
FR DFLFLXFLZFBF
(END) Dow Jones Newswires
November 22, 2023 02:00 ET (07:00 GMT)
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