Grainger's (GRI) first-half performance was especially strong. Its residential portfolio was marked up by 10.4 per cent, compared with 4.6 per cent using the combined Nationwide and Halifax price indices.
Total asset sales rose from £117m to £174m, generating a profit of £42.8m, and included the sale of a tenanted home portfolio for £85m. Net rental income fell from £27.3m to £19.5m following this unusual disposal - Grainger normally waits for tenants to pass away and then sells their homes at the much higher vacant market rate - but underlying rental growth is strong. Rental increases averaged 9.6 per cent on the regulated tenancy portfolio.
On the development side, all 27 units in the first phase of the company's Macaulay Walk project in Clapham were reserved in the first two hours, and the second phase of 28 units is already heavily oversubscribed. The loan-to-value ratio fell to 45 per cent by 31 March, but will have risen after the £160m purchase last month of a portfolio of regulated tenancies in Chelsea.
Analysts at broker Numis Securities are forecasting adjusted book value of 241p at the September year-end (from 195p in 2013).
| GRAINGER (GRI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 218p | MARKET VALUE: | £904m | |
| TOUCH: | 218-219p | 12-MONTH HIGH: | 250p | LOW: 138p |
| DIVIDEND YIELD: | 0.9% | TRADING PROPERTIES: | £863m | |
| DISCOUNT TO NAV: | 20% | |||
| INVESTMENT PROPERTIES: | £510m* | NET DEBT: ** | 182% | |
| Half-year to 31 Mar | Net asset value** (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 242 | 11 | 2.6 | 0.58 |
| 2014 | 272 | 49.8 | 11 | 0.61 |
| % change | +12 | +353 | +323 | +5 |
Ex-div: 4 Jun Payment: 4 Jul *Includes £164m within joint ventures and associates **Gross figure, with trading properties marked to market value | ||||
