SEGRO Board has declared an increase in the interim dividend of 0.6 pence per share to 8.7 pence (H1 2022: 8.1 pence), a rise of 7.4 per cent. This will be paid as a Property Income Distribution (PID) on 22 September 2023 to shareholders on the register at the close of business on 9 August 2023.
The Board will offer a scrip dividend option for the 2023 interim dividend, allowing shareholders to choose whether to receive the dividend in cash or new shares. In respect of the 2022 final dividend, 49 per cent of shareholders, representing £107 million of dividend payments, elected for the scrip option which resulted in the issue of 14.5 million new shares.
Other financial highlights include:
- Adjusted pre-tax profit of £198 million up 2.6 per cent compared with the prior year (H1 2022: £193 million), Adjusted EPS is 15.9 pence, up 1.9 per cent (H1 2022: 15.6 pence) excluding the impact of performance fees from our SELP joint venture.
- Adjusted NAV per share is down 3.0 per cent to 937 pence (31 December 2022: 966 pence) driven by a 1.4 per cent decrease in the valuation of the portfolio (UK -0.6 per cent, CE -2.7 per cent), due to outward yield shift, mitigated by 3.7 per cent growth in estimated rental values during the first half of the year.
- Like-for-like rental growth of 5.1 per cent and £44 million of new headline rent commitments generated during the six-month period (H1 2022: £55 million), driven by customer focus and active management of the portfolio.
- 340,900 sq m of development completions were delivered, equating to £28 million of potential rent, of which 83 per cent of which is leased. 85 per cent of these completions were BREEAM ‘Excellent’ certification (or local equivalent).
- Future rent roll growth supported by an active development pipeline with 740,800 sq m of projects under construction or in advanced pre-let discussions equating to £76 million of potential rent (31 December 2022: 915,600 sq m, £86 million), of which 70 per cent is associated with pre-lets signed or in advanced negotiations, substantially de-risking the 2023-24 pipeline. Yield on cost for these projects is 7.2 per cent.
- Strong balance sheet, with a modest level of gearing and significant liquidity. LTV of 34 per cent at 30 June 2023 (31 December 2022: 32 per cent) and access to £1.7 billion of cash and committed bank facilities.
- Attractive cost of debt due to our diverse, long-term debt structure. No major debt maturities until 2026 and 91 per cent of debt is fixed or capped with half of the caps active until 2029. Average cost of debt at 30 June 2023 was 2.9 per cent (31 December 2022: 2.5 per cent).
