Real estate investment trust Workspace (WKP) reported a slower rate of growth in property valuations during the first six months, up 2.6 per cent to £2.44bn on an underlying basis, compared with a reported rate of 3.5 per cent this time last year. This, in combination with fewer disposal profits (the company sold most of its industrial properties last year) pushed pre-tax profits down by nearly a fifth. But while property surveyors appear to be taking more caution ahead of the UK’s departure from the EU, chief executive Jamie Hopkins says Brexit won't have a lasting impact on the group; demand has held up well since the 2016 referendum.
Instead, Workspace uses trading profit as an indication of its success, which strips out exceptional finance costs and accounts for volatility in property valuations. Half-year trading profits increased 20 per cent to £35.4m thanks to 17 per cent growth in net rental income to £54.1m.
Analysts at Numis expect adjusted net asset value (NAV) of £1.13bn in the year to March 2019, compared with £1.04bn in FY2018.
| WORKSPACE (WKP) | ||||
| ORD PRICE: | 983p | MARKET VALUE: | £1.77bn | |
| TOUCH: | 982-984p | 12-MONTH HIGH: | 1,176p | LOW: 899p |
| DIVIDEND YIELD: | 3% | TRADING PROPERTIES: | nil | |
| DISCOUNT TO NAV: | 10% | |||
| INVESTMENT PROPERTIES: | £2.43bn | NET DEBT: | 23% | |
| Half-year to 30 Sep | Net asset value (p)* | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 1,027 | 124 | 75.7 | 8.8 |
| 2018 | 1,087 | 102 | 58.4 | 10.6 |
| % change | +7 | -18 | -23 | +20 |
| Ex-div: | 10 Jan | |||
| Payment: | 6 Feb |
