Hansteen spent much of 2011 raising money to snap up distressed industrial property and, despite spending £150m on the weighty Spencer portfolio in December, remains on the lookout for further deals. With the market to remain depressed until at least 2013, there should be no shortage of opportunities – 22 of the 58 property companies that IPO'd in 2005-06 have already disappeared, which makes Hansteen's rising dividend and discount to net assets a relative safe haven for property investors.
In the meantime, Hansteen is doing well to sweat its assets in tough markets. Even though falling property prices in Belgium and the Netherlands knocked £19.3m from the value of Hansteen's wholly owned portfolio, overall vacancy rates fell 3 percentage points to 19.4 per cent, thanks primarily by a booming German industrial market. Additions to the portfolio helped improve the total rent roll by £6m to £66.1m, reflecting a current yield of 8.4 per cent, well above the average 3.6 per cent cost of borrowing. Hansteen said that in the short term, returns to shareholders would come from rising income and dividends, ruling out cash returns from large-scale property disposals."The next five or six years will be a period for acquiring and intensely managing", it said.
Broker Peel hunt expects adjusted net asset value (NAV) of 86p this year (from 84p in 2011).
HANSTEEN (HSTN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 73p | MARKET VALUE: | £466m | |
| TOUCH: | 72-73p | 12-MONTH HIGH: | 90p | LOW: 67p |
| DIVIDEND YIELD: | 5.5% | TRADING PROPS: | £17.5m | |
| DISCOUNT TO NAV: | 9% | |||
| INVESTMENT PROPS: | £762m | NET DEBT: | 60% | |
| Year to 31 Dec | Net Asset Value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 138 | 20.4 | 8.1 | 3.2 |
| 2008 | 128 | -60.9 | -33.4 | 3.2 |
| 2009 | 84 | -21.3 | -3.9 | 3.2 |
| 2010* | 83 | 33.2 | 6.6 | 3.5 |
| 2011 | 80 | 8.9 | 1.3 | 4.0 |
| % change | -4 | -73 | -80 | +14 |
Ex-div: 25 Apr Payment: 23 May *NAV restated | ||||
