Secure Income Reit (SIR) lived up to its name in 2017, boosting adjusted net asset value by 14.5 per cent, which, together with dividends paid, equated to a total shareholder return of 19 per cent. And this comes from a portfolio comprising 81 operating assets in highly defensive sectors, and with average unexpired lease terms of 22.2 years with no breaks.
What’s more, the rental stream has inbuilt growth, with 58 per cent on fixed annual uplifts on a minimum of 2.8 per cent, and a further 27 per cent subject to an upward-only uplift linked to inflation. Just over half the portfolio comprises hospitals run by a subsidiary of Ramsey Health Care, with the balance made up of leisure attractions owned by Merlin Entertainments as well as a number of Travelodge hotels.
The biggest development came after the year-end with the announcement that substantial off-market purchases have been made costing £436m. This has been complemented with a £315.5m share placing (subject to shareholder approval) that will help to finance the purchase of several leisure assets, including an eight-acre site on top of Manchester Victoria station and The Brewery in Chiswell Street, London’s largest catered events space, as well as a further 76 Travelodge hotels.
SECURE INCOME (SIR) | |||||||||
ORD PRICE: | 372p | MARKET VALUE: | £857m | ||||||
TOUCH: | 370-373p | 12-MONTH HIGH: | 381p | LOW: 332p | |||||
DIVIDEND YIELD: | 3.7% | TRADING PROPERTIES: | nil | ||||||
PREMIUM TO NAV: | 0% | NET DEBT: |
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INVESTMENT PROPERTIES: |
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 |
2015 | 280 | 39 | 20 | nil |
2016 | 325 | 94 | 48 | 5.9 |
2017 | 373 | 139 | 60 | 13.6 |
% change | +15 | +48 | +23 | +131 |
Ex-div: | ** | |||
Payment: | ** | |||
*Nine months to 31 December **Dividends paid quarterly; latest dividend of 3.5p a share paid on 23 February |