Civitas Social Housing (CSH) is one of the few real estate investment trusts (Reit) to report undisturbed rental collection figures following the outbreak of Covid-19, receiving 96 per cent of that due in April and May. With that in mind, management stuck by its decision to raise the target dividend for the 2021 financial year to 5.4p a share.
The annualised rent roll increased 5 per cent last year, mainly due to acquisitions that totalled £31m. However, the Reit is planning to broaden the scope of the “community provision” that it provides, diversifying the counterparties to which it is exposed, said director Andrew Dawber. It is in discussions with the NHS about leasing supported housing, with plans to extend this to other not-for-profit organisations such as large charities dealing with mental health care.
That expansion will involve taking an additional £120m in debt, although gross leverage would still be a manageable 37 per cent. Given commitments that have already been made and the need to keep a cash buffer in place, any further growth would require the Reit to raise equity, said Mr Dawber.
Panmure Gordon forecasts adjusted NAV of 110p at the end of March 2021, rising to 112p the same time the following year.
| CIVITAS SOCIAL HOUSING REIT (CSH) | ||||
| ORD PRICE: | 110p | MARKET VALUE: | £ 684m | |
| TOUCH: | 108-110p | 12-MONTH HIGH: | 112p | LOW: 74p |
| DIVIDEND YIELD: | 4.8% | TRADING PROP: | Nil | |
| PREMIUM TO NAV: | 2% | |||
| INVESTMENT PROP: | £868m | NET DEBT: | 22% | |
| Year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p)** |
| 2018* | 106 | 39.6 | 10.6 | 3.0 |
| 2019 | 107 | 19.9 | 4.7 | 5.0 |
| 2020 | 108 | 37.7 | 6.1 | 5.3 |
| % change | +1 | +89 | +31 | +6 |
| Ex-div: | ** | |||
| Payment: | ** | |||
| *Period from 18 Nov to 31 Mar | ||||
| **Dividends paid quarterly, fourth quarter dividend of 1.325p a share paid on 28 Feb | ||||
