Segro (SGRO) reported another strong set of results on the back of a year in which it has sought to cement its status as an international owner of industrial warehouses. Investment worth £719m included a good chunk in markets where it wants to grow, including north Italy, the Netherlands and the UK. The group's adjusted book value rose 21 per cent to 463p, largely driven by an increased demand for warehouse space by retailers, as e-commerce continues to thrive.
With not a lot of land available for industrials, especially in London, rental prices have risen. For Segro, like-for-like rental income increased 4.2 per cent, while vacancy rates dropped from 6.3 per cent to 4.8 per cent.
Looking ahead, chief executive David Sleath describes the scale of opportunity for development as "great". Segro is forecasting £109m of new revenue in 2016 on land it already owns. The day before releasing these numbers it announced a deal with rival Roxhill to spend about £800m developing 10m sq ft of 'big box' logistics warehouses over 10 years.
Today's results outperformed brokers' expectations. Analysts at Numis upgraded their figures, and now expect adjusted net asset value of 498p at 31 December 2016, up from 463p a year earlier.
| SEGRO (SGRO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 434p | MARKET VALUE: | £3.25bn | |
| TOUCH: | 433.6-434.1p | 12-MONTH HIGH: | 467p | LOW: 401p |
| DIVIDEND YIELD: | 3.6% | TRADING PROPERTIES: | £37.6m | |
| DISCOUNT TO NAV: | 8% | NET DEBT: | 63% | |
| INVESTMENT PROPERTIES: | £4.99bn* | |||
| Year to 31 Dec | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 345 | -54 | -4.1 | 14.8 |
| 2012 | 302 | -202 | -26.6 | 14.8 |
| 2013 | 316 | 212 | 28.4 | 14.8 |
| 2014 | 390 | 654 | 92.0 | 15.1 |
| 2015 | 468 | 687 | 91.7 | 15.6 |
| % change | +20 | +5 | -0.3 | +3 |
Ex-div: 28 Mar Payment: 5 May *Includes £867m within joint ventures | ||||
