LondonMetric Plc – Half Year Report

EPRA earnings of £25.3 million or 4.0p per share, up 8%

·      Net rental income up 8% to £39.7 million

Dividend grown to 3.6p, up 3%

·      Second quarterly interim dividend declared today of 1.8p with scrip alternative

·      Dividend cover increased to 112% with further progression expected in final quarter

EPRA NAV of 143.0p (FY 16: 147.7p)

·      Portfolio revaluation deficit¹ of £23.0 million, contributing to a reported loss of £13.1 million

·      Property total return of 1.5% compared to IPD of 0.2%, 130 bps outperformance

·      Portfolio valued at £1,482 million, core portfolio valuation fall of 1.1%

Distribution weighting up to 58.5% of portfolio

·      £78.4 million of retail assets sold, reducing retail park weighting to 16.8%

·      £32.2 million of distribution investments acquired, with a further £47.2 million post period end

Income growth with structural support

·      £4.0 million of new income secured from completed developments

·      £2.0 million of additional income from 11 lettings and 22 rent reviews

·      1.9% like-for-like income growth on core portfolio

·      Rent reviews at 4.8% above previous passing and new lettings at 2.1% above ERV

Short cycle development activity

·      Post period end, terms agreed to let our 357,000 sq ft development in Warrington and 140,000 sq ft at our Stoke development. These two lettings represent £2.9 million additional rent

Portfolio metrics reflect income security, reliability and growth

·      Occupancy of 98.5% and WAULT of 12.6 years (12.0 years to first break)

·      22% of rental income subject to RPI uplifts and 29% subject to fixed uplifts

Finances strengthened and diversified by £130 million private debt placement

·      Net debt of £590.7 million (FY 16: £591.2 million) and undrawn facilities of £183.8 million

·      Debt maturity of 5.7 years (FY 16: 5.6 years) and average cost of debt at 3.3% (FY 16: 3.5%)

Andrew Jones, Chief Executive of LondonMetric, commented:

“At a time when the political and economic outlook remains uncertain, investors are increasingly looking for predictable income returns with the security of capital preservation. We continue to focus on compounding our long and strong income and value highly the repetitive, reliable and secure nature of our rents which gives us confidence to deliver dividend progression.

“Our income is structurally supported by our investment in the winning sectors and we continue to draw on our deep occupier relationships to make the correct investment decisions and create value. We have continued to sell down our mature retail parks and have further sharpened our focus on the distribution sector which offers higher growth opportunities. In particular, we have grown our 'last mile' distribution portfolio where we are capitalising on attractive demand/supply dynamics arising from consumer delivery demands for instant gratification.”