Great Portland Estates (GPOR) has been positioning itself to weather the current economic climate, but there is little it can do to avoid the sombre mood within the real-estate sector. In the year to March 2017, the portfolio valuation declined by 4.9 per cent on a like-for-like basis, and the 12-month capital return was a negative 5.1 per cent, compared with a 0.4 per cent gain in the IPD central London index.
However, the underlying picture looks a lot better. Disposals generated £727m, and while this was at a 3.1 per cent discount to March 2016 book value, this still represented a profit of £227m, some of which was used to finance £71m of bolt-on acquisitions, all in the West End of London. And, despite the weaker trend, there remains a significant reversionary element, with 32 rent reviews settled 45.3 per cent ahead of the previous passing rent and 2.6 per cent ahead of estimated rental value.
Finances are in extremely good shape, and the pro forma loan-to-value ratio stood at a nominal 12.2 per cent. In addition to the final dividend and following the sale of the commercial element of Rathbone Square, the group will pay a special dividend of 32.15p a share on 31 May, accompanied by a 19-for-20 share consolidation.
Analysts at Peel Hunt are forecasting adjusted net asset value of 772p at the March 2018 year-end (from 799p in 2017).
| GREAT PORTLAND ESTATES (GPOR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 661p | MARKET VALUE: | £2.16bn | |
| TOUCH: | 660.5-661.5p | 12-MONTH HIGH: | 801p | LOW: 536p |
| DIVIDEND YIELD: | 1.5% | TRADING PROPERTIES: | £247m | |
| DISCOUNT TO NAV: | 17% | |||
| INVESTMENT PROP: | £3bn* | NET DEBT: | 21% | |
| Year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 451 | 181 | 56 | 8.6 |
| 2014 | 564 | 422 | 123 | 8.8 |
| 2015 | 695 | 507 | 148 | 9 |
| 2016 | 847 | 555 | 163 | 9.2 |
| 2017 | 796 | -140 | -41 | 10.1 |
| % change | -6 | - | - | +10 |
Ex-div: 1 Jun Payment: 10 Jul *Includes joint ventures | ||||
