Secure Income REIT (SIR) hasn't been around for long - the initial public offering came last June. However, its progress since has been little short of meteoric, with adjusted net asset value jumping by 50 per cent to 259p a share. That's the result of an 11.6 per cent valuation uplift compounded by very high leverage on flotation.
In a complex set-up - the assets were previously held in separate sub-groups under the common ownership of Prestbury, which retains a 26 per cent stake - Secure Income derives its revenue stream from two key tenants: Merlin Entertainments, which leases Thorpe Park and Alton Towers, and Ramsay Healthcare, one of the five largest private hospital groups in the world.
Secure Income is testing the water for a possible sale of Madame Tussauds, which makes up 19 per cent of the portfolio and is valued at more than £300m. There are currently no dividends, but when the existing loan facilities are refinanced in two and a half years' time the savings in interest payments should allow dividends to commence. Net debt stands at £1.13bn, but thanks to the valuation uplift the net loan-to-value ratio fell from 80 per cent at listing to 70 per cent.
| SECURE INCOME (SIR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 283p | MARKET VALUE: | £476m | |
| TOUCH: | 280-285p | 12-MONTH HIGH: | 345p | LOW: 174p |
| DIVIDEND YIELD: | nil | TRADING PROPERTIES: | nil | |
| PREMIUM TO NAV: | 38% | NET DEBT: | £1.13bn | |
| INVESTMENT PROPERTIES: | £1.63bn | |||
| Year to 31 Dec | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014* | 204 | 133 | 150 | nil |
| % change | - | - | - | - |
Ex-div:- Payment:- *Nine months to 31 December | ||||
