Strong platform – optimising performance
Tritax EuroBox plc
RESULTS FOR THE 12 MONTHS ENDED 30 SEPTEMBER 2022
Tritax EuroBox plc (“the Company”) reports its results for the 12 months ended 30 September 2022.
Increase in rental income and cost efficiencies supporting future earnings growth and dividend cover
• 31.9% increase in rental income to €57.9m, reflecting 4.0% like-for-like rental growth, asset management activity and acquisitions.
• Adjusted EPRA cost ratio of 29.5%; Financial Year 2023 ratio expected to be c. 25%, driven by expected future income growth and estimated €2.1m annual savings from reduced management fee.
• Adjusted EPS of 4.24 cents, down 8.0% primarily due to timing of deployment of prior year equity raise.
• Dividend per share of 5.00 cents; covered in the quarter ending 30 September 2022 and expected to be fully covered for the Financial Year 2023.
Resilient investment portfolio let to strong customers on long-term inflation linked leases
• Portfolio value €1,765.6m, up 37.8% (FY 2021 €1,281.4m), primarily driven by acquisitions in the period.
• 5.6% like-for-like capital growth reflecting H1 2022 increase of 8.1% offset by 2.3% decrease in H2 2022.
• 9.5% (€7.1m) portfolio reversion driven by like-for-like estimated rental value growth of 8.2%.
• 97% of occupational leases subject to annual increases of which 82.6% linked to inflation.
• 99.7% occupancy and significant income visibility with 8.0 years WAULT.
Operational activity reinforcing portfolio resilience and ESG performance
• Acquired nine high quality, sustainable assets at a net initial yield of 3.7% adding €20.2m p.a. to annual rent and benefiting from 11.2% reversion (€2.2m).
• Development schemes totalling 31,200 sqm fully let producing €1.4m of annual rental income.
• Four new leases signed totalling €5.1 million of annual rent, an increase of €0.8m (+18%) above previous rent or guarantees.
• Awarded five Green stars and “Leader in Sustainability for European Industrial Distribution Warehouse Listed Sector” by GRESB, the global ESG benchmark for real estate.
Robust balance sheet with low and capped cost of debt - earliest maturity in Q4 2025
• Issued private placement of €200m, at an average coupon of 1.37% and average maturity of nine years.
• 100% of debt with fixed rates or caps, with a maximum average cost of debt of 1.46%.
• 4.5 years weighted maturity with earliest refinancing in Q4 2025.
• €239m of available liquidity from undrawn debt facilities at financial year end.
• Significant covenant headroom with LTV of 35% and interest cover of 3.9x compared to covenant levels of 65% and 1.5x respectively.
• Structural tailwinds and favourable occupational market fundamentals expected to continue to support occupier demand and rental growth.
• Macro factors expected to lead to further softening of asset values in the short term.
• Robust balance sheet and resilient portfolio means the business is well placed to navigate a more uncertain market outlook.
• Increased rental income and cost efficiencies will support earnings growth and dividend cover over the next financial year.
Robert Orr, Chairman of Tritax EuroBox plc, commented:
“Economic conditions have changed significantly since June, and our sector will not be immune to subsequent impacts. We will continue to monitor closely the more uncertain environment and remain attentive to the potential risk of weaker markets.
“However, our high-quality portfolio, strong customer base and robust balance sheet mean we are very well positioned to weather the economic headwinds we are facing. The lower cost base and additional revenues generated from operational activity, provide positive momentum to earnings going into 2023 and support a fully covered dividend going forward.”
Presentation for analysts and investors
A Company presentation for analysts and investors will take place via a live webcast at 09.30am (GMT) today. To view the live webcast, please register at:
Analysts and investors will also be able to listen to the event via a moderated conference call using the following details:
Phone number: +44 (0)330 551 0200
Participant access: quote ‘Tritax’
The presentation will be accessible on-demand later in the day from the Company website: https://www.tritaxeurobox.co.uk/investors/results-centre/.
1 See note 12 to the financial statements for reconciliation
2 Valuation under IFRS (excluding rental guarantees)
3 As per KPI definition
4 Including rental guarantee and licence fee
5 Adjusted for vacancy
6 Including licence fee income and rental guarantees, excluding exceptional lease surrender in Hammersbach