Empiric Student Property (ESP) floated on the London Stock Exchange in June 2014, and its progress since then has been little short of meteoric. Gross annualised income rose threefold to £25.1m in the six months to December 2015, and with the announcement of the second quarterly dividend it's well on the way to paying out a targeted 6p a share for the full year.
Providing purpose-built accommodation for students, Empiric acquired a further 2,165 beds, bringing the total to 5,686 either operating or under development across 26 cities, with only a minor exposure to the expensive London market. At the time of the IPO, the target was to build a portfolio of 10,000 beds within five years, but the company expects to achieve that well ahead of time.
To help finance the expansion programme, Empiric completed the final two tranches of a 300m share issuance launched in October 2014, raising £161m, while a further 165m issue at 107.5p a share is taking place this month, and is expected to raise around £90m. Prior to this, analysts are not making any firm net asset value forecasts. A new £40m debt facility has also been secured, and the current loan-to-value ratio of 20.3 per cent is expected to rise to a targeted 35 per cent in the near term.
| EMPIRIC STUDENT PROPERTY (ESP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 109.75p | MARKET VALUE: | £423m | |
| TOUCH: | 109.25-109.75p | 12-MONTH HIGH: | 114p | LOW: 102p |
| DIVIDEND YIELD: | 4.6% | DEVELOPMENT PROPERTIES: | nil | |
| PREMIUM TO NAV: | 5% | NET CASH: | £45.9m | |
| INVESTMENT PROPERTIES: | £357m | |||
| Half-year to 31 Dec | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p)* |
|---|---|---|---|---|
| 2014 | 99 | 3.2 | 3.3 | 2 |
| 2015 | 105 | 14.0 | 4.4 | 3 |
| % change | +6 | +333 | +33 | +50 |
Ex-div: 10 Mar Payment: 23 Mar *Dividends paid quarterly. Second interim 1.5p. | ||||
