REG - Alternative Inc REIT - NAV, Dividend Declaration & Portfolio Valuation

Alternative Income REITAnnouncement

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RNS Number : 2832C  Alternative Income REIT PLC  29 April 2026

29 April 2026

Alternative Income REIT PLC

(the "Company" or "Group" or "AIRE")

NET ASSET VALUE, DIVIDEND DECLARATION AND PORTFOLIO VALUATION UPDATE

TO 31 March 2026

Declares an interim dividend of 1.40 pence per share ("pps") for the quarter
ended 31 March 2026

The Group remains on track for its annual dividend target of no less than
5.6pps for the year ending 30 June 2026(†)

Dividend was fully covered for the quarter

Unaudited NAV total return for the quarter of +1.5%

Resilient portfolio well-placed to continue to provide secure, index-linked
income with the potential for capital growth

 

The Board of Directors of Alternative Income REIT PLC (ticker: AIRE), the
owner of a diversified portfolio of UK commercial property assets,
predominantly let on long leases with index-linked rent reviews, provides a
trading and business update and declares an interim dividend for the quarter
ended 31 March 2026.

 

Simon Bennett, Non-Executive Chair of Alternative Income REIT plc, comments:

 

The Board is pleased to declare its third interim dividend for the year ending
30 June 2026 of 1.4pps for the quarter ended 31 March 2026, and the Group
remains on track for its target annual dividend of not less than 5.6pps for
the year. The quarterly dividend was fully covered and the annual dividend
target remains subject to the continued timely collection of rent across the
portfolio and interest rate movements remaining within current market
expectations.

 

As at 31 March 2026, the Group's unaudited Net Asset Value (NAV) was £67.9
million, or 84.4pps, representing a very small decrease of 0.1% from the
previous quarter. Including the 1.40pps dividend paid during the period, this
equates to an unaudited NAV total return of +1.5% for the quarter.

The Group's portfolio was valued at £103.45 million, with a marginal decrease
in property values of £50,000 or 0.05% during the quarter. The portfolio
continues to demonstrate resilience, remaining fully let, with 100% rent
collection and 92.1% of leases being subject to index-linked rent reviews.

On 21 April 2026, the AIRE Board announced the termination of discussions with
AEW UK REIT plc, in respect of their proposal for an all-share offer. The
Board considered this to be regrettable, given the previously agreed
indicative heads of terms and the complimentary nature of both companies and
the two property portfolios. However, the Board remains confident in AIRE's
ability as a standalone entity, to generate secure and predictable income
returns, whilst maintaining capital value through investment in UK properties,
in alternative and specialist sectors and with the benefit of its new debt
facilities from HSBC, it is well placed for the future.

 

Overview of Key Financials

                                          At 31 March      At 31 December 2025  Change

                                          2026             (unaudited)

                                          (unaudited)
 Net Asset Value ("NAV")                  £67.9 million    £68.0 million        -0.1%
 NAV per share                            84.4p            84.5p                -0.1%
 Share price                              70.3p            73.6p                -4.5%
 Share price discount to NAV              16.7%            12.9%                +3.8%
 Investment property fair value           £103.5 million   £103.5 million       -

 (based on external valuation)
 Loan to gross asset value ("GAV") (A,B)  34.3%            34.3%                -
 Loan facility (B)                        £36.6 million    £36.6 million

 

 

 

                                    Quarter ended   Quarter ended        Change

                                    31 March 2026   31 December 2025

                                    (unaudited)     (unaudited)
 EPRA earnings per share (A)        1.4p            1.5p                 -6.6%
 Adjusted earnings per share (A)    1.4p            1.5p                 -6.6%
 Dividend cover (A,D)               100.7%          106.4%               -5.7%
 Total dividends per share          1.40p           1.40p                -
 Dividend yield (annualised) (A,C)  8.0%            7.6%                 +0.4%
 Earnings per share                 1.3p            1.9p                 -31.6%
 Share price total return (A)       -2.6%           +5.6%                -
 NAV total return (A)               +1.5%           +2.3%                -
 Annualised passing rent            £7.9 million    £7.9 million         -
 Ongoing charges (A) (annualised)   1.5%            1.6%                 -0.1%

(A) Considered to be an Alternative Performance Measure.

(B) The loan facility with HSBC UK Bank plc at 31 March 2026 comprising a term
loan of £31.0 million and a revolving credit facility of £10 million of
which £5.6 million was drawn down. At 31 March 2026, the weighted average
interest cost was 5.44% (31 December 2025: 5.13%).

(C) Dividend yield is based on the dividend target of 5.6 pence per share,
divided by the share price at the end of the quarter.

(D) Dividend cover is the ratio to measure the Group's ability to pay its
dividend and is calculated as adjusted earnings per share divided by dividend
per share.

 

Dividend Declaration, Earnings Per Share and Dividend Cover

 

The Board is pleased to declare its third interim dividend of 1.4pps for the
quarter ended 31 March 2026, in line with the Company's dividend target of
5.6pps for the year ending 30 June 2026. This interim dividend will be
distributed as Property Income Distribution ("PID") and will be paid on 29 May
2026 to shareholders on the register on 15 May 2026. The ex-dividend date will
be 14 May 2026.

 

The Adjusted EPS was 1.4pps for the quarter (31 December 2025: 1.5pps) and the
interim dividend was fully covered.

 

Property Portfolio

 

At 31 March 2026, the Group owned 19 properties (31 December 2025: 19
properties) valued at £103.45 million (31 December 2025: £103.5 million). In
the quarter ended 31 March 2026 the portfolio experienced an extremely small
valuation decrease of 0.05% (£50,000) attributable to its Southampton
property. The Group's portfolio continues to ride the storm of recent market
fluctuations, benefiting from being fully let, with 100% collection of rent
due and 92.1% of leases being subject to index-linked rent reviews and with
38.2% of the contracted rental income reviewed annually.

 

At 31 March 2026, the Net Initial Yield on the Group's portfolio was 7.2% (31
December 2025: 7.1%). The weighted average unexpired lease term at 31 March
2026 was 15.1 years to the earlier of break and expiry (31 December 2025: 15.4
years) and 16.8 years to expiry (31 December 2025: 17.1 years).

 

During the quarter, the Group's contracted annualised rent increased by 0.2%
(31 December 2025: 0.3%), primarily driven by the annual index-linked rent
review of the Group's property in Bristol. Active portfolio management
continues to focus on re-gearing leases, removing tenant breaks and extending
lease lengths. For the forthcoming quarter to 30 June 2026, 16.0% of the
Group's income is subject to rent review, comprising four annual
index‑linked reviews at St Helens, Dudley and Sheffield, and one
five‑yearly review at Swindon.

 

Net Asset Value, Share Price and Share Price Discount to NAV

 

At 31 March 2026, the Group's unaudited NAV was £67.9 million, 84.4pps (31
December 2025: £68.0 million, 84.5pps), representing a very small decrease in
the quarter.

 

When combined with the 1.40pps dividend paid in the quarter, this produces an
unaudited NAV total return for the quarter of +1.5% (31 December 2025: +2.3%).

 

Over the quarter, the Company's share price decreased by 4.5% to 70.3pps,
reflecting an increase in the discount from 12.9% to 16.7%.  The Company's
discount has consistently remained one of the lowest in REIT sector,
reflecting the Company's quality portfolio and dividend track record.

 

 

The table below sets out the movement in NAV during the quarter.

 

                                           Pence per share  £ million
 NAV at 31 December 2025                   84.5             68.0
 Valuation movement in property portfolio  -0.1             -0.1
 Income earned for the period              +2.5             +2.0
 Expenses for the period                   -0.4             -0.4
 Net finance costs for the period          -0.7             -0.5
 Interim dividend paid during the quarter  -1.4             -1.1
 NAV at 31 March 2026                      84.4             67.9

 

The NAV attributable to the ordinary shares has been calculated under
International Financial Reporting Standards as adopted by the United Kingdom
and incorporates both the Group's property portfolio individually valued on a
'Red Book' basis at 31 March 2026 and net income for the quarter but does not
include a provision for the interim dividend declared today (see above).

 

The income earned for the period includes an accrual for the minimum
contractual uplifts contained in the index-linked leases. In the event that
inflation is greater than these minimum contractual uplifts, the actual income
will be greater than the income currently accrued.

 

Rent Collection

 

Rent collection remains resilient with 100% collection of rent due for the
quarter ended 31 March 2026. 90.3% of the portfolio's contracted rent is
payable quarterly in advance. The remainder is payable monthly in advance.

 

Financing

 

The Group successfully refinanced its £41m loan facility in Q3 2025. Its new
HSBC Bank facilities consist of a term loan of £31 million and a £10 million
revolving credit facility ("RCF"). The Group therefore has flexibility to draw
down the RCF as and when required, unlike the previous term loan. At 31 March
2026, the Group had fully drawn down the term loan of £31 million and drawn
down £5.6 million of the RCF (31 December 2026: same). Both the term loan and
the RCF are on floating rates for a fixed term of five years with an option to
extend by two years if mutually acceptable.

 

 

 

† This is a target and not a formal dividend forecast or a profit forecast

 

ENQUIRIES

 Alternative Income REIT PLC
 Simon Bennett - Chair                                  Via AIRE's Company Secretary, Hanway Advisory: 0207 409 0181 or by email:

                                                        Aire.Cosec@jtcgroup.com

 Martley Capital Real Estate Investment Management Ltd  020 4551 1240

 Richard Croft

 Jane Blore

 Panmure Liberum Limited                                020 3100 2000
 Alex Collins
 Tom Scrivens

 

The Company's LEI is 213800MPBIJS12Q88F71.

 

Further information on Alternative Income REIT PLC is available at
www.alternativeincomereit.com (https://www.alternativeincomereit.com/)  (1).

 

(1) Neither the content of the Company's website, nor the content on any
website accessible from hyperlinks on its website or any other website, is
incorporated into, or forms part of, this announcement nor, unless previously
published on a Regulatory Information Service, should any such content be
relied upon in reaching a decision as to whether or not to acquire, continue
to hold, or dispose of, securities in the Company.

 

NOTES

Alternative Income REIT PLC aims to generate a sustainable, secure and
attractive income return for shareholders from a diversified portfolio of UK
property investments, with a particular focus on alternative and specialist
real estate sectors. The majority of the assets in the Group's portfolio are
let on long leases which contain index-linked rent review provisions.

 

The Company's asset manager is Martley Capital Real Estate Investment
Management Limited ("Martley Capital"). Martley Capital is a full-service real
estate investment management platform whose activities cover real estate
investing, lending, asset management and fund management. It has over 40
employees across five offices in the UK and Europe. The team manages assets
with a value of circa £1 billion across 30 mandates (at 31 March 2026).

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