CLS (CLI) had to contend with a lacklustre domestic market during the first half, though this was offset by a chronic lack of new office space in Germany’s major cities, which had the effect of driving the portfolio valuation higher. The commercial landlord is seeking to build the German portfolio further – unsurprising given it increased by 4.5 per cent in value, while estimated rental values were up 4.3 per cent and yields continued to harden.
Unfortunately, a softening in yields and shortening of lease lengths on non-prime assets outside London weighed on the value of the UK portfolio, which declined 0.3 per cent. In the capital, values rose thanks to a 1.1 per cent uplift to estimated rental values, still some way behind the continental portfolio. Like its neighbour, French assets rose 4.5 per cent in value in local currency, helped by a vacancy rate of just 3.1 per cent and subsequent improvement in yields. However, a dearth of office space also meant there were few acquisition opportunities.
Analysts at Berenberg expect adjusted NAV of 331p a share at the December 2019 year-end, up from 310p in the prior year.
| CLS HOLDINGS (CLI) | ||||
| ORD PRICE: | 227p | MARKET VALUE: | £925m | |
| TOUCH: | 226-228p | 12-MONTH HIGH: | 257p | LOW: 195p |
| DIVIDEND YIELD: | 3.1% | TRADING PROP: | £135m | |
| DISCOUNT TO NAV: | -21% | |||
| INVESTMENT PROP: | £1.9bn | NET DEBT: | 73% | |
| Half-year to 30 Jun | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 276 | 66.0 | 15.0 | 2.20 |
| 2019 | 288 | 84.6 | 16.8 | 2.35 |
| % change | +4 | +28 | +12 | +7 |
| Ex-div: | 22 Aug | |||
| Payment: | 27 Sep |
