West End landlord Shaftesbury (SHB) delivered a near flawless performance in the year to September, aided by its successful focus on regenerating London’s tourist heartland and abetted by a strong rise in capital values and rental growth. The shares rose 6 per cent on results day.
Adjusted net asset value jumped by an astonishing 26 per cent to 713p, while the rental value of the portfolio rose by £12.7m to £119m. Importantly, rent reversion - the difference between current rents and rental income if all properties were let at current market rents - rose by £5m to £25m, nearly 27 per cent above current income.
Acquisitions totalled £108m, and included the purchase of Newport Sandringham in Chinatown and the former Jaeger House in Broadwick Street. Both buildings are scheduled for major refurbishments that will significantly boost their income profiles. Shaftesbury can easily afford to fund the schemes, which should start in 2016, having raised £153m through a share placing in March. Net debt remains modest, at 24 per cent of gross assets.
The property portfolio was valued at £2.6bn, benefiting from a valuation uplift of £426m. That equated to an ungeared like-for-like capital return of 21 per cent - much higher than the three-year average growth rate of 12 per cent.
Analysts at Liberum reckon adjusted book value will rise 13 per cent to 805p this year.
| SHAFTESBURY (SHB) | ||||
|---|---|---|---|---|
| ORD PRICE: | 808p | MARKET VALUE: | £2.25bn | |
| TOUCH: | 803-809p | 12-MONTH HIGH: | 811p | LOW: 590p |
| DIVIDEND YIELD: | 1.6% | TRADING PROPERTIES: | nil | |
| PREMIUM TO NAV: | 19% | |||
| INVESTMENT PROP: | £2.6bn | NET DEBT: | 32% | |
| Year to 30 Sep | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 380 | 172 | 74 | 10.3 |
| 2011 | 421 | 116 | 47 | 11.3 |
| 2012 | 445 | 95 | 37 | 12.0 |
| 2013 | 527 | 242 | 95 | 12.5 |
| 2014 | 681 | 447 | 165 | 13.1 |
| % change | +29 | +85 | +74 | +5 |
Ex-div:22 Jan Payment:13 Feb | ||||
