SEGRO Reports Strong 2024 Results with 14.9% Profit Growth
Why we think this is good
SEGRO has delivered impressive financial results for 2024, with adjusted pre-tax profit up 14.9% and adjusted EPS rising 5.5%. The company demonstrated robust operational performance with 7.0% growth in net rental income and 5.8% like-for-like rental growth. Portfolio value increased by 1.1%, and ERV grew by 3.2%, indicating resilience in the face of market challenges. The successful development program, reduced LTV, and lower cost of debt further strengthen the company's position. While there's a slight dip in occupancy rates, the overall outlook remains positive, with strong leasing momentum and significant growth potential from the existing portfolio and development pipeline. The 5.4% increase in full-year dividend underscores management's confidence in the company's prospects.
Key Points
- Adjusted pre-tax profit up 14.9% to £470 million
- Adjusted EPS increased 5.5% to 34.5 pence
- Net rental income grew 7.0% to £628 million
- Like-for-like rental growth of 5.8%
- Portfolio value increased 1.1%, ERV grew 3.2%
- Development completions added £37 million potential rent, 84% leased
- LTV reduced to 28%, average cost of debt down to 2.5%
- Full-year dividend increased 5.4% to 29.3 pence
- Occupancy rate slightly decreased to 94.0%
- Positive outlook with strong leasing momentum and growth potential
Summary
SEGRO has delivered a strong set of results for 2024, demonstrating resilience and growth in a challenging market. Adjusted pre-tax profit increased by 14.9% to £470 million, while adjusted EPS rose 5.5% to 34.5 pence. The company saw net rental income grow by 7.0% to £628 million, with like-for-like rental growth of 5.8%. Portfolio performance was positive, with a 1.1% increase in value and 3.2% growth in ERV. Development completions added £37 million of potential new headline rent, with 84% already leased. The company's financial position improved, with LTV reduced to 28% and the average cost of debt down to 2.5%. A 5.4% increase in the full-year dividend to 29.3 pence reflects management's confidence in future prospects. While occupancy rates slightly decreased to 94.0%, the outlook remains positive, with strong leasing momentum and significant growth potential from both the standing portfolio and development pipeline.