REG - Grainger PLC - Preliminary Full Year Financial Results
Today 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20251120:nRST2574Ia&default-theme=true
RNS Number : 2574I Grainger PLC 20 November 2025
20 November 2025
Grainger plc
Preliminary full year financial results
for the twelve months ended 30 September 2025
Continuing to deliver excellent earnings growth
§ Net Rental Income up +12%
§ Pre tax EPRA Earnings +12%
§ Dividend per share up +10%
§ High occupancy at 98.1%
§ FY29 guidance reiterated:
£72m EPRA earnings (9.7pps),
8%+ TAR, c.30% LTV
Grainger plc, the UK's largest residential REIT and leader in the
build-to-rent (BTR) sector, today announces an excellent performance for the
12 months ended 30 September 2025.
Helen Gordon, Chief Executive, said:
"It is my pleasure to once again report that we have delivered an excellent
performance and another year of strong earnings growth.
"Our focus on delivering great homes and great service to our customers and
excellent risk-adjusted returns for shareholders has meant we have delivered
an increase in earnings of +12%, an increase in net rental income of +12% and
a +10% increase in dividend, our 20(th) consecutive period of increasing our
dividend, which has seen us distribute c.£345m to shareholders over the past
10 years. In the last 7 years we have delivered like-for-like rental growth on
average of 4.1% per annum. Customer affordability remains resilient and
customer satisfaction levels remain sector-beating and put us on par with
leading global consumer brands.
"Pre tax EPRA earnings will continue to grow. We continue to target £60m
(8.1p per share) by FY26 and £72m (9.7pps) by FY29 in line with guidance,
even after assuming we absorb higher interest rates over this period. This
growth will come from the delivery of our £343m Committed Pipeline of which
only c.£130m of capital expenditure is remaining.
"This year, after the successful transformation of Grainger into the UK's
leading listed build-to-rent business, we converted to a Real Estate
Investment Trust (REIT), which will enhance shareholder returns and supports
our enduring strategy.
"We have certainty and clarity over the regulatory landscape for our market
with the Renters' Rights Act, which aligns to our business model and rejects
any form of rent control.
"Our asset class is characterised by strong fundamentals and is low-risk. Both
residential rents and capital values have outperformed commercial real estate
for the past twenty years. Residential rents, on average, outperform
inflation. The net asset value of our portfolio has proven resilient again
this period, backed up by disposals, and over the past five years despite
increased interest rates the net asset value of our portfolio has increased
+5.0%.
"We have a clear focus on delivering returns for shareholders. Our approach to
capital allocation prioritises the delivery of our Committed Pipeline and
delivery of our earnings growth guidance to FY29, whilst also focusing on
driving cost efficiencies and deleveraging by between c.£300m-350m with a Net
Debt to EBITDA target of c.8x and LTV of c.30%. We believe this is eminently
deliverable when considering we generate c.£200m+ of cashflow each year from
operating activities and sales proceeds.
"We are committed to continuing to deliver progressive dividend growth for
years ahead.
"It has been another excellent performance for Grainger and the outlook for
the business is bright as we continue to deliver sector-leading earnings
growth despite macro-economic headwinds."
Highlights
§ +12% growth delivered in Net Rental Income(1) to £123.6m (FY24: £110.1m)
§ +12% increase in EPRA Earnings to £53.7m (FY24: £48.0m) and in EPRA EPS
to 7.3pps (FY24: 6.5pps)
§ Dividend increased +10% to 8.31p per share (FY24: 7.55p per share)
§ IFRS Profit before tax up to £102.6m
§ Strong occupancy of 98.1% in our BTR portfolio (FY24: 97.4%)
§ EBITDA margin expansion continues to 55.5% (FY24: 54.0%)
§ +3.6% like-for-like rental growth(3) in our portfolio (Mar-25: 4.4%)
o +3.4% like-for-like rental growth in our BTR Portfolio
§ +1.8% on new lets (Mar-25: 3.1%)
§ +4.5% on renewals (Mar-25: 4.9%)
o +6.6% like-for-like rental growth in our Regulated Tenancy Portfolio
(Mar-25: 7.0%)
§ Capital recycling: Strong sales performance of £169m, recycling capital
from lower-yielding assets in line with valuations into BTR
§ Net asset value (EPRA NTA) resilient at 298pps (FY24: 298pps), with overall
portfolio valuation up 0.7%
§ Strong balance sheet and funding position, debt costs fixed in mid 3%s to
FY29 with plans in place to deleverage between c.£300m-£350m by FY29,
targeting Net Debt to EBITDA of c.8x and LTV of c.30%
§ Customer affordability remains robust at 28% of gross household income
(FY24: 28%)
§ Customer satisfaction remains high, with our Customer Net Promoter Score
placing Grainger in line with leading global consumer brands
§ Rental growth for FY26 expected to be in line with the long-term historical
average of 3-3.5%
Income returns FY25 FY24 Change
Net rental income (Note 5) £123.6m £110.1m +12%
Adjusted earnings (Note 2) £91.0m £91.6m (1)%
EPRA Earnings (Note 3)(4) £53.7m £48.0m +12%
EPRA Earnings per share 7.3p 6.5p +12%
IFRS Profit before tax (Note 2) £102.6m £40.6m +153%
Earnings per share (diluted, after tax) (Note 10) (5) 27.3p 4.2p +550%
Dividend per share (Note 10)(6) 8.31p 7.55p +10%
Capital returns FY25 FY24 Change
EPRA NTA per share (Note 3) 298p 298p 0%
Net debt £1,463m £1,453m 1%
Group LTV 38.4% 38.2% +20bps
Cost of debt (average) 3.3% 3.2% +10bps
ESG benchmark performance
FTSE4Good since 2010
ISS ESG Prime Rating
MSCI ESG 'AA'
Sustainalytics ESG Risk Rating Low Risk
S&P Corporate Sustainability Assessment 91(st) percentile
Dow Jones Best-In-Class Indices Europe constituent
EPRA Sustainability Best Practice Reporting Gold Award
CDP (formerly the Carbon Disclosure Project) 'B' for Climate Change
'B-' for water
'A-'for supply chain
Workforce Disclosure Initiative 98%
GRESB Public Disclosure 'A' Rating
National Equality Standard Accredited in FY24
SBTi (Science Based Targets initiative) Validated emissions reduction targets
Future reporting dates
2026
AGM & Trading update 4 February
Half year results 14 May
Trading update October
Full year results 19 November
(1) Refer to Note 5 for net rental income calculation.
(2) Refer to Note 2 for profit before tax and adjusted earnings
reconciliation.
(3) Rental growth is the average increase in rent charged across our portfolio
on a like-for-like basis.
(4) EPRA Earnings is a measure of recurring earnings from core operational
activities which the Company uses in accordance with the Best Practices
Recommendations of the European Public Real Estate Association (EPRA). For
more details please see page 180-183 of the Annual Report and Accounts
(5) £123.6m tax credit (17p) arising from REIT conversion. This does not
impact the Net Tangible Asset (NTA) metric.
(6) Dividends - Subject to approval at the AGM, the final dividend of 5.46p
per share (gross) amounting to £40.4m will be paid on 20 February 2026 to
Shareholders on the register at the close of business on the record date, 16
January 2026 (the shares will go ex-dividend on 15 January 2026). Shareholders
will again be offered the option to participate in a dividend reinvestment
plan and the last day for election is 30 January 2026. An interim dividend of
2.85p per share amounting to a total of £21.1m was paid to Shareholders on 7
July 2025. - refer also to Note 11.
Results presentation
Grainger will be holding a presentation of the results at 08.30am (UK time)
today, 20 November 2025, which can be accessed via webcast and a telephone
dial-in facility (details below), which will be followed by a live Q&A
session for sell side analysts and shareholders.
Webcast details:
To view the webcast, please go to the following URL link. Registration is
required.
https://brrmedia.news/GRI_FY_25 (https://brrmedia.news/GRI_FY_25)
The webcast will be available for six months from the date of the
presentation.
Conference call details:
Call: +44 (0)330 551 0200
Confirmation Code: Quote Grainger FY25 when prompted by the operator
A copy of the presentation slides will also be available to download on
Grainger's website (http://corporate.graingerplc.co.uk/
(http://corporate.graingerplc.co.uk/) ) from 08:30am (UK time).
Annual Report & Accounts
We are today also publishing our 2025 Annual Report & Accounts on our
website, including the ESEF (tagged) version,
(https://corporate.graingerplc.co.uk/investors/investor-downloads
(https://corporate.graingerplc.co.uk/investors/investor-downloads) ) and we
will also be submitting both versions to the National Storage Mechanism and
they will shortly be available for inspection at:
data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fprotect-eu.mimecast.com%2Fs%2FvJkDCWPDNU0KNkjunirWQ%3Fdomain%3Ddata.fca.org.uk&data=05%7C02%7CKMueller%40graingerplc.co.uk%7C281a824a714f4f9e786908dd056671c7%7C6a65c76a9e1a46b0af9a50b67f5fd204%7C0%7C0%7C638672659768422116%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&sdata=xKjXB0ZhCs5oJaGsiMA1MFoC2xjaWCY7xQB0QT9loTM%3D&reserved=0)
.
We will be publishing our Notice of Annual General Meeting in December 2025,
and we will also submit this to the National Storage Mechanism to make it
available for inspection. A further announcement will be made at this time.
For further information, please contact:
Investor relations
Kurt Mueller, Grainger plc:
+44 (0) 20 7940 9500
Media
Ginny Pulbrook / Geoffrey Pelham-Lane, Camarco:
+44 (0) 20 3757 4992 /
4985
Forward-looking statements disclaimer
This announcement may contain certain statements that are forward-looking
statements. They appear in a number of places throughout this announcement and
include statements regarding Grainger plc's intentions, beliefs or current
expectations and those of our officers, directors and employees concerning,
amongst other things, our results of operations, financial condition,
liquidity, prospects, growth, strategies and the business we operate. By their
nature, these statements involve risks and uncertainty since future events and
circumstances can cause results and developments to differ materially from
those anticipated. The forward-looking statements reflect knowledge and
information available at the date of preparation of this announcement and,
unless otherwise required by applicable law, Grainger plc undertakes no
obligation to update or revise these forward-looking statements. Nothing in
this announcement should be construed as a profit forecast. Grainger plc and
its Directors accept no liability to third parties in respect of this
announcement save as would arise under English law.
Information about the management of the Principal Risks and Uncertainties
facing Grainger plc is set out within the Annual Report and Accounts 2025. Any
forward-looking statements in this announcement speak only at the date of this
announcement and Grainger plc undertakes no obligation to update publicly or
review any forward-looking statement to reflect new information or events,
circumstances or developments after the date of this announcement.
Nature of announcement
This announcement is for information purposes only and no reliance may be
placed upon it. No representative or warranty, either expressed or implied, is
provided in relation to the accuracy, completeness or reliability of the
information contained in this announcement. Past performance of securities in
Grainger plc cannot be relied upon as a guide to the future performance of
such securities. This announcement does not constitute an offer for sale or
subscription of, or solicitation of any offer to buy or subscribe for, any
securities of Grainger plc.
Chief Executive's Statement
Continuing to deliver excellent earnings growth
Once again I am pleased to say your company has delivered another excellent
performance with strong income growth, evidencing our resilience despite
macroeconomic headwinds.
These challenging macro factors, including enduring high interest rates, are
undoubtedly putting downward pressure on the listed real estate sector
generally. However we are focused on what is in our control, such as growing
income, managing costs, and enhancing our portfolio of high quality homes.
Portfolio expansion and strong operational performance delivered another year
of strong earnings growth, with pre tax EPRA earnings up +12%. IFRS profit
before tax was £102.6m (FY24: £40.6m) as a result of positive valuation
movements.
Grainger operates in the UK housing rental market which continues to see a
worsening supply shortage coupled with strong demand. Our sector-leading
operational platform enables us to outperform and we delivered exceptional
occupancy in the year of 98.1% alongside robust like-for-like rental growth of
3.6%, broadly in line with the long run average.
Our customer affordability level remains robust at 28% and customer
satisfaction levels remain sector-beating with scores alongside global
consumer brands.
Our capital structure is in a strong position with our average cost of debt at
3.3% and remaining low until FY29, with plans in place to reduce debt in the
medium-term.
We will continue to recycle out of our low-yielding, non-core assets
(primarily regulated tenancies) which will fund the remaining spend in our
Committed Pipeline and enable us to reduce net debt by between c.£300m-£350m
by FY29 to support ongoing earnings growth.
Grainger is therefore well positioned to continue to grow and deliver
shareholder value. Our £343m Committed Pipeline, with only c.£130m remaining
to spend, will grow earnings significantly. We continue to target £60m
earnings (pre tax EPRA basis) by FY26 and £72m by FY29 in line with prior
guidance.
In addition, we have a significant pipeline of future opportunities which
provides us optionality to accelerate growth in the future.
Strategic transformation culminating in REIT conversion
It is almost 10 years since I set out our build-to-rent (BTR) strategy and our
ambition to deliver for Shareholders a company with resilient earnings in an
undersupplied market. We laid out a path toward transforming Grainger into a
focused, simplified residential rental investment business and over the past
10 years we have delivered:
1. +14% 10yr CAGR in Net Rental Income
2. Significantly increased EPRA earnings to £54m
3. Increased EBITDA margins by nearly 3 times from 19% to 56%
4. Increased dividend per share by +202%, 20 consecutive periods of
growth, distributing c.£345m to Shareholders over the 10 year period
5. Improved customer satisfaction by 2.75 times or +66pts
since we first measured NPS in 2017
We have disposed of £1.9bn of non-core assets over the 10 year period and
have invested to create from scratch our BTR portfolio which now stands at
£2.9bn and 11,078 homes, serving more than 25,000 customers.
This major transformation focusing on growing recurring rental income has
enabled us to convert to a Real Estate Investment Trust (REIT) this year,
which requires at least 75% of assets and profits to come from rental
investments.
REIT status will enhance shareholder returns and importantly will not impede
our growth trajectory. Our business model and strategy remains unchanged.
Grainger has a compelling investment case:
1. Low risk asset class with resilient growth
2. Strong market fundamentals
3. Strong customer base with positive outlook for rental growth
4. Certain and supportive regulatory outlook
5. Sector leading portfolio and operational platform underpinned by data
insight.
Residential rental: Low risk asset class with excellent growth prospects
Residential rental has some of the most defensive characteristics of any real
estate asset class. Both residential rents and capital values have
outperformed commercial real estate for the past twenty years. Residential
rents, on average, outperform inflation. The net asset value of our portfolio
has proven resilient again this period, backed up by sales. Over the past five
years despite increased interest rates the net asset value of our portfolio
has increased +5.0%.
Strong market fundamentals
A worsening supply shortage with a current deficit of 4.3m homes nationally
contrasts starkly with a growing population of renters. Only 2.5% of the
rental market is BTR with the remainder mainly made up of small, private
landlords who continue to exit the sector. At the same time, demand for
renting continues to grow with Savills forecasting 20% growth in demand for
the 10 years to 2031
Strong customer base
Our customer base is diverse and robust. Customer affordability remains stable
and healthy at 28%, and our customers are employed across a broad range of
sectors and job types.
A certain and supportive regulatory outlook
There is a strong political and societal push toward greater
professionalisation. In October this year the Government passed the Renters'
Rights Bill. We now have certainty over the regulatory outlook for our market
and we have confirmation that this Government fundamentally opposes any form
of rent controls. We are well positioned to thrive in this new legislative
environment.
All these factors provide a strong foundation for Grainger's continued future
success.
A market-beating strategy with a sector leading portfolio and operational
platform underpinned by data insight
Grainger's BTR strategy is to invest in and provide mid-market rental homes in
locations with the greatest demand and shortest supply. We own and manage all
our properties directly. We are responsible for the customer relationship and
this overall approach allows us to outperform. It allows us to fully
understand our customers, their preferences and drivers and respond
accordingly. Our technology platform, CONNECT, enables us to manage a large
portfolio efficiently and effectively.
Our sector-leading operational platform is focused on delivering great service
to customers and great value for Shareholders.
Delivering outperformance
Our strategy has proven that it delivers. We continue to achieve high
occupancy and responsibly drive rental growth year-on-year.
This in turn delivers shareholder returns. EPRA Earnings were up +12% this
year, after a 24% increase last year. And this growth will continue. From the
delivery of our Committed Pipeline, after assuming a full rebasing of our debt
costs to a higher rate, we expect to grow EPRA earnings significantly to £72m
by FY29.
The portfolio continues to demonstrate its resilience with valuations stable
and EPRA NTA resilient at 298p per share. The value of our portfolio (EPRA
NTA) is up +5.0% over the past five years despite the high interest rate
environment. This is amongst the highest in the real estate sector, evidencing
our resilience. And our accelerated disposals programme reaffirms the value of
our portfolio with a high volume of varying asset types being sold in line
with valuations. Over the last three years, we have sold £640m of non-core
assets.
Due to the strength of Grainger's ongoing performance, we are proposing a
final dividend of 5.46p per share, which brings our total dividend for the
year to 8.31p, a +10% increase.
A leading approach to the workplace, communities and environment
We are committed to being a great place to work. Our recognition by the
National Equality Standard reaffirms this commitment.
Equally, our colleagues confirm that Grainger is a great place to work. This
year we achieved our highest ever employee engagement score, securing two out
of three stars for being an 'Outstanding' workplace by the independent
assessor Best Companies, and placing in the Top 50 best places to work in the
Large Company category.
Our high performance and inclusive culture is central to Grainger's continued
success and strength.
Over the year, we partnered with over 30 local charities, giving both
colleagues and customers the opportunity to give something back to their local
communities. Much of our charitable efforts focus on housing and homelessness,
aligned to our business. One standout initiative is our partnership with the
youth homelessness charity, LandAid, and our involvement in their BTR
Pathfinder programme, which sees us pledging accommodation to support young
people at risk of homelessness. To date, we have supported three young people
to give them a home in our communities from which to start living
independently.
We have for many years also taken a sector leading approach to sustainability.
I am pleased to report that this year our emissions reduction targets have
been validated by the globally recognised Science Based Targets initiative
(SBTi) and align to the 1.5 degree climate commitment by the UK Government and
the Paris Agreement. Because of our strong sustainability credentials, we have
now been added to the Dow Jones Best-in-Class Indices for Europe for 2025,
supplementing our high ratings in a number of other benchmarks. And I am
pleased to report that 96% of our BTR portfolio now has EPC certificates of
between A to C, providing our customers energy efficient homes.
An excellent, positive outlook
As I first mentioned, what we have in our control is in excellent shape and we
intend to ensure this remains the case.
A focus on capital allocation and delivering shareholder value
With current expectations of high interest rates remaining, we are focusing
our attention on the imminent delivery of our Committed Pipeline and
delivering our guided EPRA earnings target of £72m by FY29. Our other
priority is to reduce net debt in order to mitigate against the impact of
higher interest rates. These initiatives are both deliverable because of our
successful ongoing disposals programme.
We are equally focusing our attention on costs, particularly central
overheads. Our platform has been designed for growth and scale, and as the
pace of our acquisitions naturally settles to align to the prevailing market
conditions, it is important we manage costs appropriately in the interim. We
therefore have plans in place to ensure central costs are as efficient as
possible and sized appropriately for the scale and nature of our portfolio.
With this front footed approach, we will maintain the strength of our market
positioning to enable us to accelerate growth swiftly in the future.
I would like to thank the Board of Grainger and particularly our Chair of the
last nine years, Mark Clare, for his unwavering support of our strategy and
for his guidance and insights he has given me and the senior leadership team
of Grainger. His support has been invaluable. I would also like to thank
Justin Read, our Senior Independent Director, for leading the search for our
Chair Designate, Simon Fraser. I look forward to working with Simon.
Finally, I would like to thank my colleagues, an exceptional team who have
once again delivered for you.
Helen Gordon
Chief Executive Officer
19 November 2025
Financial review
FY25 saw another strong year of growth in net rental income and earnings, with
good visibility of further growth to come. Strong occupational markets with
occupancy at 98.1% and like-for-like rental growth of 3.6% combined with our
pipeline deliveries saw total net rents grow by 12%. This resulted in strong
earnings growth with pre tax EPRA earnings up 12%, as we continue to target
£60m for the coming year and £72m by FY29.
It was also another good year for sales with £169m of sales delivered during
the year, demonstrating both the value and liquidity of our asset base.
Despite the challenging macroeconomic backdrop valuations were marginally up
in the year as we saw ERV growth of 3.2% offsetting a small outward yield
shift.
Our balance sheet remains in a healthy position with strong liquidity and a
good hedging profile. Both net debt and LTV are broadly in line with the prior
year. With only c.£130m of committed capex left to spend we will start using
our significant operating cash flows to lower leverage by c.£300m-£350m from
FY27 onwards.
Our dividend per share continues its strong growth trajectory, increasing by
10.1% to 8.31p on a per share basis (FY24: 7.55p).
We also successfully converted to a REIT in September 2025 marking a
significant milestone in Grainger's transformation. Converting to REIT status
positions Grainger as a more tax‑efficient investment vehicle, eliminating
effective double taxation for the business and its Shareholders. The move
unlocks meaningful Shareholder value through improved returns, strengthens the
company's ability to continue to grow its dividend, and allows the business to
continue to enhance its operational platform. In the year we have recognised a
tax credit of £123.6m as a result of the conversion.
Financial highlights
Income return FY25 FY24 Change
Rental growth (like-for-like) 3.6% 6.3% -270bps
- BTR 3.4% 6.3% -290bps
- Regulated tenancies 6.6% 6.6% -
Net rental income (Note 5) £123.6m £110.1m +12%
Adjusted earnings (Note 2) £91.0m £91.6m (1)%
EPRA earnings (Note 3) £53.7m £48.0m +12%
IFRS profit before tax (Note 2) £102.6m £40.6m +153%
Earnings per share (diluted, after tax) (Note 10) (1) 27.3p 4.2p +550%
Dividend per share (Note 11) 8.31p 7.55p +10%
Capital return FY25 FY24 Change
Total Property Return 3.9% 1.9% +200bps
Total Accounting Return (NTA basis) (Note 3) 2.6% 0.1% +230bps
EPRA NTA per share (Note 3) 298p 298p -
Net debt £1,463m £1,453m +1%
Group LTV 38.4% 38.2% +20bps
Cost of debt (average) 3.3% 3.2% +10bps
Reversionary surplus £131m £147m (11)%
1. £123.6m tax credit (17p) arising from REIT conversion. This does
not impact the Net Tangible Asset (NTA) metric.
Income statement
The business continues to deliver very strong growth in EPRA earnings, up 12%
to £53.7m (FY24: £48.0m) This was driven by continued strong growth in net
rents of 12% combined with a strong focus on cost efficiency.
Adjusted earnings were broadly flat at £91.0m (FY24: £91.6m) as the sales
profits from our reducing regulated tenancy business are replaced with rental
income from our pipeline. The lower sales profits were in line with the
smaller size of the regs portfolio.
IFRS profit before tax was £102.6m (FY24: £40.6m) as a result of positive
valuation movements.
FY25 FY24
Income statement (£m) Change
Net rental income 123.6 110.1 +12%
Mortgage income (CHARM, Note 16) 4.3 4.6 (7)%
Management fees and other income(1) 6.1 8.1 (25)%
Overheads (36.7) (35.3) (4)%
Pre-contract costs (0.7) (1.0) +30%
Net finance costs (42.7) (38.8) (10)%
Joint ventures (0.2) 0.3 (167)%
EPRA earnings(2) 53.7 48.0 +12%
EPRA EPS 7.3p 6.5p +12%
Profit from sales 37.3 43.6 (14)%
Adjusted earnings 91.0 91.6 (1)%
Adjusted EPS (diluted, after tax)(3) 9.3p 9.3p -
Valuation movements(4) 23.4 (39.4) +159%
Other adjustments (11.8) (11.6) (2)%
IFRS profit before tax 102.6 40.6 +153%
Earnings per share (diluted, after tax)(5) 27.3p 4.2p +550%
1 Including LADs: "liquidated and ascertained damages" of £3.6m (2024:
£5.2m)which provide financial compensation for the loss of rental income
caused by delays to the practical completion of our schemes
2 EPRA Earnings is a measure of recurring earnings from core operational
activities. For more details please see page 35
3 Adjusted earnings per share includes tax of £22.2m (FY24: £22.9m) at the
Group's adjusted tax rate of 24.4%(FY24: 25%), adjusted for the effect of REIT
conversion (FY24: 25%).
4 Including £(59)m in H1 FY24 due to the removal of MDR; excluding this,
underlying valuation movement was +£20m in FY24.
5 £123.6m tax credit (17p) arising from REIT conversion. This does not
impact the Net Tangible Asset (NTA) metric.
Rental income
Net rental income increased by 12% to £123.6m (FY24: £110.1m), as we saw
continued strength in occupational markets. The strong £13.5m increase was
driven by a combination of strong delivery of pipeline scheme launches which
contributed £17.7m along with another year of rental growth reflecting strong
demand for our product.
Overall like-for-like rental growth was in line with our long run average at
+3.6% (FY24: +6.3%) with the BTR portfolio continuing to deliver at +3.4%
(FY24: +6.3%), with rental growth on renewals of +4.5% (FY24: +6.8%) and +1.8%
(FY24: +5.6%) on new lets. While our new lets rental growth remained strong,
the lower levels compared to FY24 were due to our focus on maximising our
occupancy levels. Our regulated tenancy portfolio also delivered strong rental
growth at +6.6% (FY24: +6.6%). Looking forward we maintain our guidance on
rental growth in the coming year to continue in line with the long-run average
rate of 3.0% - 3.5%, with occupational markets back to normalised levels we
expect to see some seasonality in rental growth return with H2 stronger than
H1 growth.
Gross to net for our stabilised portfolio improved to 25.0% (FY24: 25.0%) as
we continue our strong focus on cost efficiencies.
£m
FY24 Net rental income 110.1
Rental growth and occupancy 2.1
PRS Investment 17.7
Disposals (6.3)
FY25 Net rental income 123.6
Sales
FY25 was another good year for sales as we continue our non-core asset
recycling strategy in order to fund the required capital expenditure on our
committed pipeline and the plan to lower leverage. Overall sales revenue was
£168.9m, (FY24: £274.3m) with £82.4m of sales revenue coming from BTR
recycling and £86.4m from regs sales. The continued delivery of sales saw
pricing in line with book values, justifying current valuations.
Sales profits were lower at £37.3m (FY24: £43.6m) as expected reflecting a
smaller regulated tenancy portfolio from which sales profits are generated.
Profits from BTR recycling are based on valuation and therefore profit margins
are much lower.
Vacant property sales profits in the period were down (27)%, as expected,
delivering £18.5m (FY24: £25.4m), Vacancy rates were slightly lower at 6.0%
(FY24: 7.1%) with margins slightly down on prior year due to the tenancy mix.
Pricing achieved remained robust with sales values within 0.4% of vacant
possession values.
Sales of tenanted and other properties delivered £18.7m of profit (FY24:
£15.6m) from £121.2m of revenue (FY24: £194.0m).
FY25 FY24
Sales (£m) Revenue Profit Revenue Profit
Residential sales on vacancy 47.6 18.5 54.9 25.4
Tenanted and other sales 121.2 18.7 194.0 15.6
Residential sales total 168.8 37.2 248.9 41.0
Development sales 0.1 0.1 25.4 2.6
Overall sales 168.9 37.3 274.3 43.6
Overheads
Overheads increased by 4% in the period to £36.7m (FY24: £35.3m) as a result
of wage growth across our employee base. Looking forward we see the
opportunity to remove £2m of costs from overheads of which we expect to
deliver £1m of these savings in the coming year. This will ensure that
overheads will not increase in the next 2 years.
Balance sheet
Our BTR portfolio now represents 84% of our operational portfolio given the
success of both our pipeline delivery and regulated tenancy recycling.
LTV was broadly flat on the prior year at 38.4% (FY24: 38.2%) reflecting
investment. Looking forward, we plan to lower net debt by c.£300m-£350m by
FY29 in order to mitigate the impact of rising finance costs as our low rate
hedging rolls off. This will be funded by our strong operating cash flows.
EPRA NTA was flat at 298p per share (FY24: 298p per share) reflecting the
resilience of our asset class against a backdrop of macroeconomic
uncertainty.
Market value balance sheet (£m) FY25 FY24
Residential - BTR 2,846 2,708
Residential - regulated tenancies 503 591
Residential - mortgages (CHARM) 49 57
Forward Funded - BTR work in progress 223 266
Development work in progress 93 84
Investment in JVs/associates 93 91
Total investments 3,807 3,797
Net debt (1,463) (1,453)
Other liabilities (61) (48)
EPRA NRV 2,283 2,296
Deferred and contingent tax - trading assets (64) (76)
Exclude: intangible assets (2) (2)
EPRA NTA 2,217 2,218
Add back: intangible assets 2 2
Deferred and contingent tax - investment assets (1) (113)
Fair value of fixed rate debt and derivatives 60 88
EPRA NDV 2,278 2,195
EPRA NRV pence per share 307 309
EPRA NTA pence per share 298 298
EPRA NDV pence per share 307 295
Pence per share
EPRA NTA at 30 September 2024 298
Net rents, fees & income 18
Overheads (5)
Finance costs (6)
EPRA earnings 7
Valuations (trading & investment property) 1
Dividends, tax & other (8)
EPRA NTA at 30 September 2025 298
Property portfolio performance
Over the year our portfolio valuation was up overall by 0.7%. Our BTR
portfolio grew 1.1% over the year which saw strong ERV growth of 3.2% which
was partly offset by a small outward yield movement in the period. Valuations
in the regulated portfolio were largely flat in the year.
Portfolio Region Capital Value Total Valuation movement
£m £m %
BTR London & SE 1,378 7 +0.5%
Regions 1,468 24 +1.6%
BTR total 2,846 31 +1.1%
Regulated tenancies London & SE 447 (3) (0.7)%
Regions 56 0 (0.1)%
Regulated tenancy total 503 (3) (0.6)%
Operational portfolio 3,349 28 0.8%
BTR development 316 (2) (0.6)%
Total portfolio 3,665 26 0.7%
Financing and capital structure
Net debt was broadly flat during the year at £1,463m (FY24: £1,453m),
however it was down from the half year position of £1,475m. The significant
investment in our pipeline of £133m was offset by our continued asset
recycling strategy generating £174m of net sales proceeds. With only c.£130m
left to spend on our committed pipeline, we will start to use operational cash
flows to lower net debt from FY27.
We have minimal refinancing risk with an average debt maturity of 3.9 years
including extension options. We continue to benefit from a very strong hedging
profile, which is in place until FY29 and with our average cost of debt
remaining relatively flat at 3.3% (FY24: 3.2%). Looking forward we plan to
lower our net debt by £300m-£350m over the next 4 years, which would equate
to an LTV of c.30% and c.8x net debt to EBITDA which we see as the appropriate
capital structure in this current interest rate environment.
FY25 FY24
Net debt £1,463m £1,453m
Loan to value (LTV) 38.4% 38.2%
Cost of debt 3.3% 3.2%
Headroom £532m £509m
Weighted average facility maturity (years) 3.9 4.7
Hedging 100% 95%
Summary and outlook
FY25 was yet another year of strong growth in net rents and earnings as we
continue to deliver compounding growth. As we start our next phase of growth
as a REIT, we are confident of the outlook and retain our prior guidance of
targeting pre tax EPRA earnings of £60m for FY26 and £72m by FY29, a period
over which we will absorb the substantial headwind of higher interest rates.
This continued growth despite the macroeconomic headwinds is a testament to
the resilience of our asset class and the excellence of our operating
platform.
Rob Hudson
Chief Financial Officer
19 November 2025
Consolidated income statement
For the year ended 30 September Notes 2025 2024
£m
£m
Group revenue 4 262.7 290.1
Net rental income 5 123.6 110.1
Profit on disposal of trading property 6 38.9 49.4
Loss on disposal of investment property 7 (1.6) (5.8)
Gain/(loss) from financial interest in property assets 16 1.1 (1.3)
Fees and other income 8 6.1 8.1
Administrative expenses (36.7) (35.3)
Other expenses (4.0) (6.0)
Reversal of impairment/(impairment) of inventories to net realisable value 13 0.6 (0.1)
Operating profit 128.0 119.1
Net valuation gains/(losses) on investment property 12 29.5 (32.5)
Hedge ineffectiveness under IFRS 9 (8.5) (6.6)
Finance costs (45.4) (41.8)
Finance income 2.7 3.0
Share of profit/(loss) of associates after tax 14 0.6 (0.4)
Share of loss of joint ventures after tax 15 (4.3) (0.2)
Profit before tax 2 102.6 40.6
Tax charge 21 (23.6) (9.4)
Tax credit arising from REIT conversion 21 123.6 -
Profit for the year attributable to the Shareholders of the Company 202.6 31.2
Basic earnings per share 10 27.4p 4.2p
Diluted earnings per share 10 27.3p 4.2p
Consolidated statement of comprehensive income
For the year ended 30 September Notes 2025 2024
£m
£m
Profit for the year 2 202.6 31.2
Items that will not be transferred to the consolidated income statement:
Remeasurement of BPT Limited defined benefit pension scheme 22 (0.3) (3.1)
Items that may be or are reclassified to the consolidated income statement:
Changes in fair value of cash flow hedges (2.3) (20.8)
Other comprehensive expense for the year before tax (2.6) (23.9)
Tax relating to components of other comprehensive income:
Tax relating to items that will not be transferred to the consolidated income 21 0.1 0.8
statement
Tax relating to items that may be or are reclassified to the consolidated 21 0.6 5.2
income statement
Total tax relating to components of other comprehensive income 0.7 6.0
Other comprehensive expense for the year after tax (1.9) (17.9)
Total comprehensive income for the year attributable to the Shareholders of 200.7 13.3
the Company
( )
Consolidated statement of financial position
2025 2024
As at 30 September Notes £m £m
ASSETS
Non-current assets
Investment property 12 3,059.4 2,996.8
Property, plant and equipment 9.2 10.6
Investment in associates 14 15.2 14.9
Investment in joint ventures 15 77.5 76.4
Financial interest in property assets 16 48.6 57.4
Retirement benefits 22 6.2 6.5
Deferred tax assets 21 4.6 6.1
Intangible assets 2.9 1.8
3,223.6 3,170.5
Current assets
Inventories - trading property 13 298.6 331.6
Investment property - held for sale 12 64.9 31.5
Trade and other receivables 17 79.2 90.9
Derivative financial instruments 20 14.1 19.8
Current tax assets 5.6 5.2
Cash and cash equivalents 85.8 93.2
548.2 572.2
Total assets 3,771.8 3,742.7
LIABILITIES
Non-current liabilities
Interest-bearing loans and borrowings 20 1,515.1 1,592.9
Trade and other payables 18 5.7 6.3
Provisions for other liabilities and charges 19 0.7 1.0
Deferred tax liabilities 21 8.2 121.5
1,529.7 1,721.7
Current liabilities
Interest-bearing loans and borrowings 20 75.0 -
Trade and other payables 18 115.3 114.1
Provisions for other liabilities and charges 19 12.0 13.2
202.3 127.3
Total liabilities 1,732.0 1,849.0
NET ASSETS 2,039.8 1,893.7
EQUITY
Issued share capital 37.2 37.2
Share premium account 817.9 817.9
Merger reserve 20.1 20.1
Capital redemption reserve 0.3 0.3
Cash flow hedge reserve 2.7 4.4
Retained earnings 1,161.6 1,013.8
TOTAL EQUITY 2,039.8 1,893.7
( )
Consolidated statement of changes in equity
Notes Issued Share Merger Capital Cash Retained Total
share
premium account
reserve
redemption
flow
earnings
equity
capital
£m
£m
reserve
hedge
£m
£m
£m
£m
reserve
£m
Balance as at 37.2 817.8 20.1 0.3 20.0 1,033.2 1,928.6
1 October 2023
Profit for the year 2 - - - - - 31.2 31.2
Other comprehensive expense for the year - - - - (15.6) (2.3) (17.9)
Total comprehensive income - - - - (15.6) 28.9 13.3
Award of SAYE shares - 0.1 - - - - 0.1
Purchase of own shares - - - - - (0.1) (0.1)
Share-based payments charge 23 - - - - - 2.8 2.8
Dividends paid - - - - - (51.0) (51.0)
Total transactions with Shareholders recorded directly in equity - 0.1 - - - (48.3) (48.2)
Balance as at 37.2 817.9 20.1 0.3 4.4 1,013.8 1,893.7
30 September 2024
Profit for the year 2 - - - - - 202.6 202.6
Other comprehensive expense for the year - - - - (1.7) (0.2) (1.9)
Total comprehensive income - - - - (1.7) 202.4 200.7
Purchase of own shares - - - - - (0.1) (0.1)
Share-based payments charge 23 - - - - - 3.6 3.6
Dividends paid - - - - - (58.1) (58.1)
Total transactions with Shareholders recorded directly in equity - - - - - (54.6) (54.6)
Balance as at 37.2 817.9 20.1 0.3 2.7 1,161.6 2,039.8
30 September 2025
Consolidated statement of cash flows
For the year ended 30 September Notes 2025 2024
£m
£m
Cash flow from operating activities
Profit for the year 2 202.6 31.2
Depreciation and amortisation 1.7 1.5
Net valuation (gains)/losses on investment property 12 (29.5) 32.5
Hedge ineffectiveness under IFRS 9 8.5 6.6
Net finance costs 42.7 38.8
Share of loss of associates and joint ventures 14, 15 3.7 0.6
Loss on disposal of investment property 7 1.6 5.8
Share-based payments charge 23 3.6 2.8
Gain/(loss) from financial interest in property assets 16 (1.1) 1.3
Provisions for liabilities and charges 19 1.6 4.5
Tax (credit)/charge 21 (100.0) 9.4
Cash generated from operating activities before changes in working capital 135.4 135.0
Decrease/(increase) in trade and other receivables 6.2 (3.8)
Increase in trade and other payables 12.9 6.9
Decrease in inventories 33.0 60.6
Cash generated from operating activities 187.5 198.7
Interest paid (53.3) (52.6)
Interest received 2.7 3.0
Cash outflow from fire safety remediation work (3.1) -
Tax paid (11.4) (12.5)
Net cash inflow from operating activities 122.4 136.6
Cash flow from investing activities
Proceeds from sale of investment property 85.9 90.2
Proceeds from financial interest in property assets 16 9.9 8.3
Dividends received from associates 14 0.3 0.5
Investment in joint ventures 15 (3.7) -
Loans advanced to joint ventures 15 (1.7) (1.4)
Acquisition of investment property 12 (148.4) (261.0)
Acquisition of property, plant and equipment and intangible assets (1.4) (4.3)
Net cash outflow from investing activities (59.1) (167.7)
Cash flow from financing activities
Award of SAYE shares - 0.1
Purchase of own shares (0.1) (0.1)
Proceeds from new loans and borrowings 186.0 244.0
Payment of loan costs (2.3) (2.8)
Cash flows relating to new derivatives / settlement of derivatives (5.0) (1.9)
Repayment of loans and borrowings (191.2) (185.0)
Dividends paid (58.1) (51.0)
Net cash (outflow)/inflow from financing activities (70.7) 3.3
Net decrease in cash and cash equivalents (7.4) (27.8)
Cash and cash equivalents at the beginning of the year 93.2 121.0
Cash and cash equivalents at the end of the year 85.8 93.2
( )
Notes to the preliminary financial results
1. Accounting policies
1a Basis of preparation
The Board approved this preliminary announcement on 19 November 2025. The
financial information included in this preliminary announcement does not
constitute the Group's statutory accounts for the years ended 30 September
2024 or 30 September 2025. Statutory accounts for the year ended 30
September 2024 have been delivered to the Registrar of Companies. The
statutory accounts for the year ended 30 September 2025 will be delivered to
the Registrar of Companies following the Company's annual general meeting.
The auditors, KPMG LLP, have reported on the accounts for both years. The
reports were unqualified, did not include reference to any matters by way of
emphasis and did not contain statements under section 498 (2) or (3) of the
Companies Act 2006.
These financial statements for the year ended 30 September 2025 have been
prepared under the historical cost convention except for the following assets
and liabilities, and corresponding income statement accounts, which are stated
at their fair value; investment property; derivative financial instruments;
and financial interest in property assets.
The accounting policies used are consistent with those contained in the
Group's full annual report and accounts for the year ended 30 September 2025.
The financial information included in this preliminary announcement has been
prepared in accordance with UK-adopted international accounting standards
(IFRS) and applicable law. The Group elected to adopt REIT status from 8
September 2025. As a consequence of the Group's REIT status, UK corporation
tax is not levied on the Group's qualifying property rental business profits,
or gains from the sale of qualifying investment properties.
1b Adoption of new and revised International Financial Reporting Standards
and interpretations
The following new standards and amendments to standards were issued and
adopted in the year and have no material impact on the financial statements:
• Amendments to IAS 1 - Classification of liabilities as current or
non-current;
• Amendments to IAS 1 - Non-current Liabilities with Covenants;
• Amendments to IAS 7 and IFRS 7 - Disclosures: Supplier finance
arrangements;
• Amendments to IFRS 16 - Lease liability in a sale and leaseback.
The following new standards and amendments to standards have been issued but
are not yet effective for the Group and have not been early adopted:
• Amendments to IAS 21 - Lack of exchangeability;
• Amendments to IFRS 9 and IFRS 7 - Amendments to the Classification
and Measurement of Financial Instruments;
• Annual Improvements to IFRS Accounting Standards - Volume 11;
• Amendments to IFRS 9 and IFRS 7 - Contracts Referencing
Nature-dependent Electricity;
• IFRS 18 - Presentation and Disclosure in Financial Statements;
• IFRS 19 - Subsidiaries without Public Accountability: Disclosures;
• Amendments to IFRS 10 Consolidated Financial Statements;
• Amendments to IAS 28 Investments in Associates and Joint Ventures.
With the exception of IFRS 18, which the Group is still assessing and the
impact to the financial statements is not yet known, the application of these
new standards and amendments are not expected to have a material impact on the
Group's financial statements.
1c Significant judgements and estimates
Estimates
i. Valuation of property assets
Residential trading property is carried in the statement of financial position
at the lower of cost and net realisable value and investment property is
carried at fair value. The Group does, however, in its principal non-GAAP net
asset value measures, EPRA NRV, EPRA NTA and EPRA NDV, include trading
property at market value.
The adjustment in the value of trading property is the difference between the
statutory book value and its market value as set out in Note 3. For investment
property, market value is the same as fair value. In respect of trading
properties, market valuation is the key assumption in determining the net
realisable value of those properties.
Notes to the preliminary financial results continued
In all cases, forming these valuations inherently includes elements of
judgement and subjectivity with regards to the selection of unobservable
inputs. The valuation basis and key unobservable inputs are outlined in Note 2
in the 2025 Annual Report and Accounts.
The results and the basis of each valuation and their impact on both the
financial statements and market value for the Group's non-GAAP net asset value
measures are set out below:
PRS Other Total Valuer % of properties
for which
£m Reversionary £m £m
external valuer
provides
£m
valuation
Trading property 1.6 265.7 31.3 298.6
Investment property(1) 3,110.1 14.2 - 3,124.3
Financial asset (CHARM) - 48.6 - 48.6
Total statutory book value 3,111.7 328.5 31.3 3,471.5
Trading property
Residential 1.6 489.2 - 490.8 Allsop LLP 77%
Developments - - 50.2 50.2 CBRE Limited 94%
Total trading property at market value 1.6 489.2 50.2 541.0
Investment property
Residential 603.7 14.2 - 617.9 Allsop LLP / CBRE Limited 99%
Developments 46.0 - - 46.0 CBRE Limited 94%
New build PRS 2,086.5 - - 2,086.5 CBRE Limited 100%
Affordable housing 229.0 - - 229.0 Allsop LLP 100%
Tricomm Housing 144.9 - - 144.9 Allsop LLP 100%
Total investment property 3,110.1 14.2 - 3,124.3
Financial asset (CHARM)(2) - 48.6 - 48.6 Allsop LLP 100%
Total assets at market value 3,111.7 552.0 50.2 3,713.9
Statutory book value 3,111.7 328.5 31.3 3,471.5
Market value adjustment(3) - 223.5 18.9 242.4
Total assets at market value 3,111.7 552.0 50.2 3,713.9
Net revaluation gain recognised in the income statement for wholly-owned 29.5
properties
Net revaluation loss relating to joint ventures and associates(4) (3.5)
Net revaluation gain recognised in the year(4) 26.0
( )
(1) Includes investment property - held for sale
(2) Allsop LLP provide vacant possession values used by the Directors to
value the financial asset.
(3) The market value adjustment is the difference between the statutory book
value and the market value of the Group's properties. Refer to Note 3 for
market value net asset measures.
(4 ) Includes the Group's share of joint ventures and associates revaluation
loss after tax.
Judgements
i. Distinction between investment and trading property
The Group considers the intention at the outset when each property is acquired
in order to classify the property as either an investment or a trading
property. Where the intention is either to trade the property or where the
property is held for immediate sale upon receiving vacant possession within
the ordinary course of business, the property is classified as trading
property. Where the intention is to hold the property for its long-term rental
yield and/or capital appreciation, the property is classified as an investment
property. The classification of the Group's properties is a significant
judgement which directly impacts the statutory net asset position, as trading
properties are held at the lower of cost and net realisable value, whilst
investment properties are held at fair value, with gains or losses taken
through the consolidated income statement.
Notes to the preliminary financial results continued
The Group continually reviews properties for changes in use that could
subsequently change the classification of properties. A change of use occurs
if property meets, or ceases to meet, the definition of investment property
which is more than a change in management's intentions. The fact patterns
associated with changes in the way in which properties are utilised are
considered on a case by case basis and to the extent that a change in use is
established, property reclassifications are reflected appropriately.
1d Group risk factors
The principal risks and uncertainties facing the Group are set out in the Risk
Management report of the 2025 Annual Report and Accounts. A number of risks
faced by the Group are not directly within our control such as the wider
economic and political environment.
1e Going concern assessment
The Directors are required to make an assessment of the Group's ability to
continue to trade as a going concern for the foreseeable future. Given the
macro-economic conditions in which the Group is operating, the Directors have
placed a particular focus on the appropriateness of adopting the going concern
basis in preparing the financial statements for the year ended 30 September
2025.
The financial position of the Group, including details of its financing and
capital structure, is set out in the financial review on pages 31 to 36 in the
2025 Annual Report and Accounts. In making the going concern assessment, the
Directors have considered the Group's principal risks (see pages 59 to 63 in
the 2025 Annual Report and Accounts) and their impact on financial
performance. The Directors have assessed the future funding commitments of the
Group and compared these to the level of committed loan facilities and cash
resources over the medium term. In making this assessment, consideration has
been given to compliance with borrowing covenants along with the uncertainty
inherent in future financial forecasts and, where applicable, severe but
plausible sensitivities have been applied to the key factors affecting
financial performance for the Group.
The going concern assessment covers as least a year from the date of approval
of the financial statements. It uses the same forecasts considered by the
Group for the purposes of the Viability Statement. The assessment considers a
severe but plausible downside scenario, reflecting the following key
assumptions:
· Reducing PRS occupancy to 90%
· Rental growth reduced by 100bps to 2.0%
· Reducing property valuations by 10%, driven by rents yield
expansion or house price deflation
· Operating and development cost inflation of 10% p.a.
· An increase in SONIA of 2%
The Group's forecasts incorporate the likely impact of climate change and
sustainability requirements including costs to deliver our climate related
targets. This includes EPC upgrades across the portfolio and investing in
energy efficient solutions for central heating systems.
No new financing is assumed in the assessment period, but existing facilities
are assumed to remain available. Even in this severe but plausible downside
scenario, the Group has sufficient cash reserves, with the loan-to-value
covenant remaining no higher than 46% (facility maximum covenant ranges
between 70% - 75%) and interest cover no lower than 2.69x (facility minimum
covenant ranges between 1.35x - 1.75x) for the period.
Based on these considerations, together with available market information and
the Directors' experience of the Group's property portfolio and markets, the
Directors continue to adopt the going concern basis in preparing the accounts
for the year ended 30 September 2025.
1f Forward-looking statement
Certain statements in this preliminary announcement are forward-looking.
Although the Group believes that the expectations reflected in these
forward-looking statements are reasonable, we can give no assurance that these
expectations will prove to have been correct. Because these statements involve
risks and uncertainties, actual results may differ materially from those
expressed or implied by these forward-looking statements. We undertake no
obligation to update any forward-looking statements whether as a result of new
information, future events or otherwise. See page 5 for the full
forward-looking statements disclaimer.
Notes to the preliminary financial results continued
2. Analysis of profit before tax
The table below details adjusted earnings, which is one of Grainger's key
performance indicators. The metric is utilised as a key measure to aid
understanding of the performance of the continuing business and excludes
valuation movements and other adjustments, which do not form part of the
normal ongoing revenue or costs of the business and, either individually or in
aggregate, are material to the reported Group results.
2025 2024
£m Statutory Valuation Other adjustments Adjusted earnings Statutory Valuation Other adjustments Adjusted earnings
Group revenue 262.7 - - 262.7 290.1 - - 290.1
Net rental income 123.6 - - 123.6 110.1 - - 110.1
Profit on disposal of trading property 38.9 - - 38.9 49.4 - - 49.4
Loss on disposal of investment property (1.6) - - (1.6) (5.8) - - (5.8)
Income/(expense) from financial interest in property assets 1.1 3.2 - 4.3 (1.3) 5.9 - 4.6
Fees and other income 6.1 - - 6.1 8.1 - - 8.1
Administrative expenses (36.7) - - (36.7) (35.3) - - (35.3)
Other expenses (4.0) - 3.3 (0.7) (6.0) - 5.0 (1.0)
Reversal of impairment/(impairment) of inventories to net realisable value 0.6 (0.6) - - (0.1) 0.1 - -
Operating profit 128.0 2.6 3.3 133.9 119.1 6.0 5.0 130.1
Net valuation gains/(losses) on investment property 29.5 (29.5) - - (32.5) 32.5 - -
Hedge ineffectiveness under IFRS 9 (8.5) - 8.5 - (6.6) - 6.6 -
Finance costs (45.4) - - (45.4) (41.8) - - (41.8)
Finance income 2.7 - - 2.7 3.0 - - 3.0
Share of profit/(loss) of associates after tax 0.6 (0.2) - 0.4 (0.4) 0.9 - 0.5
Share of loss of joint ventures after tax (4.3) 3.7 - (0.6) (0.2) - - (0.2)
Profit before tax 102.6 (23.4) 11.8 91.0 40.6 39.4 11.6 91.6
Tax credit/(charge) 100.0 (9.4)
Profit for the year attributable to the owners of the Company 202.6 31.2
Basic adjusted earnings per share 9.3p 9.3p
Diluted adjusted earnings per share 9.3p 9.3p
Profit before tax in the adjusted columns above of £91.0m (2024: £91.6m) is
the adjusted earnings of the Group. Adjusted earnings per share assumes tax of
£22.2m (2024: £22.9m) in line with the Group's current year tax rate of
24.4%, adjusted for the effect of REIT conversion on 8 September 2025 (2024:
25.0%), divided by the weighted average number of shares as shown in Note 10.
The Group's IFRS statutory earnings per share is also detailed in Note 10.
The classification of amounts as other adjustments is a judgement made by
management and is a matter referred to the Audit Committee for approval.
Included in other adjustments are £1.9m of fire safety provisions (2024:
£5.0m), REIT conversion costs of £0.6m (2024: £nil), aborted acquisition
costs of £0.8m (2024: £nil), and hedge ineffectiveness under IFRS 9 of
£8.5m (2024: £6.6m).
Notes to the preliminary financial results continued
3. Segmental information
IFRS 8, Operating Segments requires operating segments to be identified based
upon the Group's internal reporting to the Chief Operating Decision Maker
('CODM') so that the CODM can make decisions about resources to be allocated
to segments and assess their performance. The Group's CODM are the Executive
Directors.
The two significant segments for the Group are PRS and Reversionary. The PRS
segment includes stabilised PRS assets as well as PRS under construction
through direct development and forward funding arrangements, both for
wholly-owned assets and the Group's interest in joint ventures and associates
as relevant. The Reversionary segment includes regulated tenancies, as well as
CHARM. The Other segment includes legacy strategic land and development
arrangements, along with administrative expenses.
The key operating performance measure of profit or loss used by the CODM is
adjusted earnings before tax, valuation and other adjustments.
The principal net asset value (NAV) measure reviewed by the CODM is EPRA NTA
which is considered to be the most relevant, and therefore the primary NAV
measure for the Group. EPRA NTA reflects the tax that will crystallise in
relation to the trading portfolio, whilst excluding the volatility of mark to
market movements on fixed rate debt and derivatives which are unlikely to be
realised. Other NAV measures include EPRA NRV and EPRA NDV which we report
alongside EPRA NTA.
Information relating to the Group's operating segments is set out in the
tables below. The tables distinguish between adjusted earnings, valuation
movements and other adjustments and should be read in conjunction with Note 2.
2025 Income statement
£m PRS Reversionary Other Total
Group revenue 162.0 98.7 2.0 262.7
Segment revenue - external
Net rental income 111.6 10.9 1.1 123.6
Profit on disposal of trading property 0.2 38.7 - 38.9
Loss on disposal of investment property (1.7) 0.1 - (1.6)
Income from financial interest in property assets - 4.3 - 4.3
Fees and other income 5.6 - 0.5 6.1
Administrative expenses - - (36.7) (36.7)
Other expenses (0.1) - (0.6) (0.7)
Net finance costs (35.8) (6.2) (0.7) (42.7)
Share of trading loss of joint ventures and associates after tax 0.2 - (0.4) (0.2)
Adjusted earnings 80.0 47.8 (36.8) 91.0
Valuation movements 26.6 (3.2) - 23.4
Other adjustments (1.9) - (9.9) (11.8)
Profit before tax 104.7 44.6 (46.7) 102.6
A reconciliation from adjusted earnings to EPRA earnings is detailed in the
table below, with further details shown in the EPRA performance measures
section at the end of this document:
£m PRS Reversionary Other Total
Adjusted earnings 80.0 47.8 (36.8) 91.0
Profit on disposal of trading property (0.2) (38.7) - (38.9)
Loss on disposal of investment property 1.7 (0.1) - 1.6
EPRA earnings 81.5 9.0 (36.8) 53.7
Notes to the preliminary financial results continued
2024 Income statement
£m PRS Reversionary Other Total
Group revenue 150.3 112.5 27.3 290.1
Segment revenue - external
Net rental income 97.6 11.5 1.0 110.1
Profit on disposal of trading property (1.3) 48.1 2.6 49.4
Loss on disposal of investment property (5.9) 0.1 - (5.8)
Income from financial interest in property assets - 4.6 - 4.6
Fees and other income 7.5 - 0.6 8.1
Administrative expenses - - (35.3) (35.3)
Other expenses (0.4) - (0.6) (1.0)
Net finance costs (31.3) (6.6) (0.9) (38.8)
Share of trading profit of joint ventures and associates after tax 0.3 - - 0.3
Adjusted earnings 66.5 57.7 (32.6) 91.6
Valuation movements (33.5) (5.9) - (39.4)
Other adjustments (5.0) - (6.6) (11.6)
Profit before tax 28.0 51.8 (39.2) 40.6
A reconciliation from adjusted earnings to adjusted EPRA earnings is detailed
in the table below:
£m PRS Reversionary Other Total
Adjusted earnings 66.5 57.7 (32.6) 91.6
Profit on disposal of trading property 1.3 (48.1) (2.6) (49.4)
Loss on disposal of investment property 5.9 (0.1) - 5.8
EPRA earnings 73.7 9.5 (35.2) 48.0
Segmental assets
The net asset value measures reviewed by the CODM are EPRA NRV, EPRA NTA and
EPRA NDV. These measures reflect the current market value of trading property
owned by the Group rather than the lower of historical cost and net realisable
value. These measures are considered to be a more relevant reflection of the
value of the assets owned by the Group.
EPRA NRV is the Group's statutory net assets plus the adjustment required to
increase the value of trading stock from its statutory accounts value of the
lower of cost and net realisable value to its market value. In addition, the
statutory statement of financial position amounts for both deferred tax on
property revaluations and derivative financial instruments net of deferred
tax, including those in joint ventures and associates, are added back to
statutory net assets. Finally, the market value of Grainger plc shares owned
by the Group are added back to statutory net assets.
EPRA NTA assumes that entities buy and sell assets, thereby crystallising
certain levels of deferred tax liabilities. For the Group, deferred tax in
relation to revaluations of its trading portfolio is taken into account by
applying the expected rate of tax to the adjustment that increases the value
of trading stock from its statutory accounts value of the lower of cost and
net realisable value, to its market value. The measure also excludes all
intangible assets on the statutory balance sheet, including goodwill.
EPRA NDV reverses some of the adjustments made between statutory net assets,
EPRA NRV and EPRA NTA. All of the adjustments for the value of derivative
financial instruments net of deferred tax, including those in joint ventures
and associates, are reversed. The adjustment for the deferred tax on
investment property revaluations excluded from EPRA NRV and EPRA NTA are also
reversed, as is the intangible adjustment in respect of EPRA NTA, except for
goodwill which remains excluded. In addition, adjustments are made to net
assets to reflect the fair value, net of deferred tax, of the Group's fixed
rate debt.
Notes to the preliminary financial results continued
Total Accounting Return (NTA basis) of 2.6% is calculated from the closing
EPRA NTA of 298p per share plus the dividend paid of 7.55p per share in the
year, divided by the opening EPRA NTA of 298p per share.
These measures are set out below by segment along with a reconciliation to the
summarised statutory statement of financial position:
2025 Segment net assets
£m PRS Reversionary Other Total Pence per share
Total segment net assets (statutory) 1,911.1 104.3 24.4 2,039.8 274
Total segment net assets (EPRA NRV) 1,915.1 327.5 40.5 2,283.1 307
Total segment net assets (EPRA NTA) 1,912.1 271.7 32.8 2,216.6 298
Total segment net assets (EPRA NDV) 1,911.1 271.7 95.2 2,278.0 307
2025 Reconciliation of EPRA NAV measures
£m Statutory balance sheet Adjustments EPRA NRV Adjustments to deferred and contingent tax and intangibles EPRA NTA balance sheet Adjustments to derivatives, fixed rate debt and intangibles EPRA NDV
to market
balance
balance
value, deferred
sheet
sheet
tax and
derivatives
Investment property(1) 3,124.3 - 3,124.3 - 3,124.3 - 3,124.3
Investment in joint ventures and associates 92.7 - 92.7 - 92.7 - 92.7
Financial interest in property assets 48.6 - 48.6 - 48.6 - 48.6
Inventories - trading property 298.6 242.4 541.0 - 541.0 - 541.0
Cash and cash equivalents 85.8 - 85.8 - 85.8 - 85.8
Other assets 121.8 (3.1) 118.7 (2.9) 115.8 (3.3) 112.5
Total assets 3,771.8 239.3 4,011.1 (2.9) 4,008.2 (3.3) 4,004.9
Interest-bearing loans and borrowings (1,590.1) - (1,590.1) - (1,590.1) 65.7 (1,524.4)
Deferred and contingent tax liabilities (8.2) 4.0 (4.2) (63.6) (67.8) (1.0) (68.8)
Other liabilities (133.7) - (133.7) - (133.7) - (133.7)
Total liabilities (1,732.0) 4.0 (1,728.0) (63.6) (1,791.6) 64.7 (1,726.9)
Net assets 2,039.8 243.3 2,283.1 (66.5) 2,216.6 61.4 2,278.0
( )
(1) Includes investment property - held for sale
2024 Segment net assets
£m PRS Reversionary Other Total Pence per share
Total segment net assets (statutory) 1,757.6 117.5 18.6 1,893.7 255
Total segment net assets (EPRA NRV) 1,873.5 386.9 35.5 2,295.9 309
Total segment net assets (EPRA NTA) 1,870.3 319.1 28.7 2,218.1 298
Total segment net assets (EPRA NDV) 1,757.3 319.1 118.5 2,194.9 295
Notes to the preliminary financial results continued
2024 Reconciliation of EPRA NAV measures
£m Statutory balance sheet Adjustments EPRA NRV Adjustments to deferred and contingent tax and intangibles EPRA NTA balance sheet Adjustments to derivatives, fixed rate debt and intangibles EPRA NDV
to market
balance
balance
value, deferred
sheet
sheet
tax and
derivatives
Investment property 3,028.3 - 3,028.3 - 3,028.3 - 3,028.3
Investment in joint ventures and associates 91.3 - 91.3 - 91.3 - 91.3
Financial interest in property assets 57.4 - 57.4 - 57.4 - 57.4
Inventories - trading property 331.6 288.5 620.1 - 620.1 - 620.1
Cash and cash equivalents 93.2 - 93.2 - 93.2 - 93.2
Other assets 140.9 (3.2) 137.7 (1.8) 135.9 21.1 157.0
Total assets 3,742.7 285.3 4,028.0 (1.8) 4,026.2 21.1 4,047.3
Interest-bearing loans and borrowings (1,592.9) - (1,592.9) - (1,592.9) 98.1 (1,494.8)
Deferred and contingent tax liabilities (121.5) 116.9 (4.6) (76.0) (80.6) (142.4) (223.0)
Other liabilities (134.6) - (134.6) - (134.6) - (134.6)
Total liabilities (1,849.0) 116.9 (1,732.1) (76.0) (1,808.1) (44.3) (1,852.4)
Net assets 1,893.7 402.2 2,295.9 (77.8) 2,218.1 (23.2) 2,194.9
( )
4. Group revenue
2025 2024
£m
£m
Gross rental income (Note 5) 170.2 154.8
Gross proceeds from disposal of trading property (Note 6) 86.4 127.2
Fees and other income (Note 8) 6.1 8.1
262.7 290.1
5. Net rental income
2025 2024
£m
£m
Gross rental income 170.2 154.8
Property operating expenses (46.6) (44.7)
123.6 110.1
6. Profit on disposal of trading property
2025 2024
£m
£m
Gross proceeds from disposal of trading property 86.4 127.2
Selling costs (2.0) (2.3)
Net proceeds from disposal of trading property 84.4 124.9
Carrying value of trading property sold (Note 13) (45.5) (75.5)
38.9 49.4
7. Loss on disposal of investment property
2025 2024
£m
£m
Gross proceeds from disposal of investment property 82.5 147.1
Selling costs (2.2) (3.8)
Net proceeds from disposal of investment property 80.3 143.3
Carrying value of investment property sold (Note 12) (81.9) (149.1)
(1.6) (5.8)
Notes to the preliminary financial results continued
8. Fees and other income
2025 2024
£m
£m
Property and asset management fee income 2.3 2.6
Other sundry income 3.8 5.5
6.1 8.1
Included within other sundry income in the current year is £3.6m (2024:
£5.2m) liquidated and ascertained damages ('LADs') recorded to compensate the
Group for lost rental income resulting from the delayed completion of
construction contracts.
9. Finance costs and income
2025 2024
£m
£m
Finance costs
Bank loans and mortgages 20.3 18.6
Non-bank financial institution 8.4 8.4
Corporate bond 22.9 22.9
Interest capitalised under IAS 23 (10.4) (11.6)
Other finance costs 4.2 3.5
45.4 41.8
Finance income
Interest receivable from joint ventures (0.9) (1.2)
Other interest receivable (1.8) (1.8)
(2.7) (3.0)
Net finance costs 42.7 38.8
10. Earnings per share
Basic
Basic earnings per share is calculated by dividing the profit or loss
attributable to the owners of the Company by the weighted average number of
ordinary shares in issue during the year, excluding ordinary shares purchased
by the Group and held both in Trust and as treasury shares to meet its
obligations under which the dividends are being waived.
Diluted
Diluted earnings per share is calculated by adjusting the weighted average
number of shares in issue by the dilutive effect of ordinary shares that the
Company may potentially issue relating to its share option schemes and
contingent share awards under the share based payment schemes, based upon the
number of shares that would be issued if 30 September 2025 was the end of the
contingency period. Where the effect of the above adjustments is antidilutive,
they are excluded from the calculation of diluted earnings per share.
30 September 2025 30 September 2024
Profit for Weighted average number of shares (millions) Earnings Profit for Weighted average number of shares (millions) Earnings
the year
per share (pence)
the year
per share (pence)
£m
£m
Basic earnings per share
Profit attributable to equity holders 202.6 738.8 27.4 31.2 738.2 4.2
Effect of potentially dilutive securities
Share options and contingent shares - 3.5 (0.1) - 3.3 -
Diluted earnings per share
Profit attributable to equity holders 202.6 742.3 27.3 31.2 741.5 4.2
11. Dividends
Subject to approval at the AGM, the final dividend of 5.46p per share (gross)
amounting to £40.4m will be paid on 20 February 2026 to Shareholders on the
register at the close of business on the record date, 16 January 2026 (the
shares will go ex-dividend on 15 January 2026). Shareholders will again be
offered the option to participate in a dividend reinvestment plan and the last
day for election is 30 January 2026. An interim dividend of 2.85p per share
amounting to a total of £21.1m was paid to Shareholders on 7 July 2025.
Notes to the preliminary financial results continued
12. Investment property
2025 2024
£m
£m
Opening balance 3,028.3 2,948.9
Acquisitions 20.0 85.9
Capital expenditure - completed assets 17.2 13.9
Capital expenditure - assets under construction 111.2 161.2
Total additions 148.4 261.0
Disposals (Note 7) (81.9) (149.1)
Net valuation gains/(losses) on investment properties(1) 29.5 (32.5)
3,124.3 3,028.3
Reclassifications to investment property - held for sale (64.9) (31.5)
Closing balance 3,059.4 2,996.8
(1) Within the above are provisions for fire safety works. No potential
recovery of these costs has been accounted for.
Within investment property are a number of assets held for sale at the
reporting date, valued at £64.9m (2024: £31.5m). Held for sale properties
are those that are for sale, where solicitors have been instructed, or where
contracts have been exchanged. All investment properties which are held for
sale are included within our PRS segment.
13. Inventories - trading property
2025 2024
£m
£m
Opening balance 331.6 392.2
Additions 11.9 15.0
Disposals (Note 6) (45.5) (75.5)
Reversal of impairment/(impairment) of inventories to net realisable value 0.6 (0.1)
Closing balance 298.6 331.6
14. Investment in associates
2025 2024
£m
£m
Opening balance 14.9 15.8
Share of profit/(loss) for the year 0.6 (0.4)
Dividends paid in the year (0.3) (0.5)
Closing balance 15.2 14.9
The closing balance comprises share of net assets of £0.7m (2024: £0.4m) and
net loans due from associates of £14.5m (2024: £14.5m). At the balance sheet
date, there is no expectation of any material credit losses on loans due.
As at 30 September 2025, the Group's interest in active associates was as
follows:
% of ordinary share capital held Country of incorporation Accounting period end
Vesta LP 20.0 UK 30 September
15. Investment in joint ventures
2025 2024
£m
£m
Opening balance 76.4 75.2
Share of loss for the year (4.3) (0.2)
Further investment(1) 3.7 -
Loans advanced to joint ventures 1.7 1.4
Closing balance 77.5 76.4
( )
(1) Grainger invested £3.7m into Connected Living London (BTR) Limited in the
year (2024: £nil).
Notes to the preliminary financial results continued
The closing balance comprises share of net assets of £46.1m (2024: £46.7m)
and net loans due from joint ventures of £31.4m (2024: £29.7m). At the
balance date, there is no expectation of credit losses on loans due.
At 30 September 2025, the Group's interest in active joint ventures was as
follows:
% of ordinary share capital held Country of incorporation Accounting period end
Connected Living London (BTR) Limited 51 UK 30 September
Curzon Park Limited 50 UK 31 March
Lewisham Grainger Holdings LLP 50 UK 30 September
16. Financial interest in property assets ('CHARM' portfolio)
2025 2024
£m
£m
Opening balance 57.4 67.0
Cash received from the instrument (9.9) (8.3)
Amounts taken to income statement 1.1 (1.3)
Closing balance 48.6 57.4
The CHARM portfolio is a financial interest in equity mortgages held by the
Church of England Pensions Board as mortgagee. It is accounted for under IFRS
9 and is measured at fair value through profit and loss.
It is considered to be a Level 3 financial asset as defined by IFRS 13. The
financial asset is included in the fair value hierarchy within Note 20.
17. Trade and other receivables
2025 2024
£m
£m
Rent and other tenant receivables 4.5 4.8
Deduct: Provision for impairment (1.6) (1.5)
Rent and other tenant receivables - net 2.9 3.3
Restricted deposits 57.7 63.3
Other receivables 12.7 19.3
Prepayments 5.9 5.0
Closing balance 79.2 90.9
The Group's assessment of expected credit losses involves estimation given its
forward-looking nature. This is not considered to be an area of significant
judgement or estimation due to the balance of gross rent and other tenant
receivables of £4.5m (2024: £4.8m). Assumptions used in the forward-looking
assessment are continually reviewed to take into account likely rent
deferrals.
Restricted deposits arise from contracts with third parties that place
restrictions on use of funds and cannot be accessed on demand. These deposits
are held in connection with facility arrangements and are released by the
lender on a quarterly basis once covenant compliance has been met.
The fair values of trade and other receivables are considered to be equal to
their carrying amounts.
Notes to the preliminary financial results continued
18. Trade and other payables
2025 2024
£m
£m
Current liabilities
Deposits received 13.9 12.8
Trade payables 22.7 19.0
Lease liabilities 0.6 0.7
Tax and social security costs 0.8 4.9
Accruals 66.0 64.5
Deferred income 11.3 12.2
115.3 114.1
Non-current liabilities
Lease liabilities 5.7 6.3
5.7 6.3
Total trade and other payables 121.0 120.4
Within accruals, £46.0m comprises accrued expenditure in respect of ongoing
construction activities (2024: £43.9m).
19. Provisions for other liabilities and charges
2025 2024
£m
£m
Current provisions for other liabilities and charges
Opening balance 13.2 8.6
Additions 1.9 5.0
Utilisation (3.1) (0.4)
12.0 13.2
Non-current provisions for other liabilities and charges
Opening balance 1.0 1.1
Reversal (0.3) -
Utilisation - (0.1)
0.7 1.0
Total provisions for other liabilities and charges 12.7 14.2
Current provisions relate to potential fire safety remediation costs relating
to a small number of legacy properties that Grainger historically had an
involvement in developing and are expected to require fire safety related
remediation works. These were first recognised in the year ended 30 September
2022 after an extensive assessment of the Group's legal and constructive
obligations arising from the Building Safety Act 2022 and other associated
fire regulations, and based on the results of relevant surveys which were
commissioned. The provision is based on the latest estimation of costs to be
incurred, offset by costs incurred to date. Where fire safety works are
required and the Group owns the properties, the cost is considered as part of
the valuation of those properties. Where appropriate, the Group is seeking
recoveries from contractors and insurers.
20. Interest-bearing loans and borrowings and financial risk management
2025 2024
£m
£m
Current liabilities
Non-bank financial institution 75.0 -
75.0 -
Non-current liabilities
Bank loans - Pounds sterling 544.1 548.2
Bank loans - Euros 0.7 0.8
Non-bank financial institution 273.5 347.9
Corporate bonds 696.8 696.0
1,515.1 1,592.9
Total interest-bearing loans and borrowings 1,590.1 1,592.9
The above analyses of loans and borrowings are net of unamortised loan issue
costs and the discount on issuance of the corporate bonds. As at 30 September
2025, unamortised costs totalled £11.7m (2024: £13.7m) and the outstanding
discount was £1.3m (2024: £1.6m).
Notes to the preliminary financial results continued
Categories of financial instrument
The Group holds financial instruments such as financial interest in property
assets, trade and other receivables (excluding prepayments), derivatives, cash
and cash equivalents. For all assets and liabilities excluding
interest-bearing loans the book value was the same as the fair value as at 30
September 2025 and as at 30 September 2024.
As at 30 September 2025, the fair value of the non-bank loans is £331.1m
(2024: £319.1m), but there is no requirement under IFRS 9 to adjust the
carrying value of loans, all of which are stated at unamortised cost in the
consolidated statement of financial position.
Market risk
The Group is exposed to market risk through interest rates, the availability
of credit and house price movements relating to the Tricomm Housing portfolio
and the CHARM portfolio. The Group is not significantly exposed to equity
price risk or to commodity price risk.
Fair values
IFRS 13 sets out a three-tier hierarchy for financial assets and liabilities
valued at fair value. These are as follows:
Level 1 - quoted prices (unadjusted) in active markets for identical assets
and liabilities;
Level 2 - inputs other than quoted prices included in Level 1 that are
observable for the asset or liability, either directly or indirectly; and
Level 3 - unobservable inputs for the asset or liability.
The following table presents the Group's assets and liabilities that are
measured at fair value:
2025 2024
Assets Liabilities Assets Liabilities
£m
£m
£m
£m
Level 3
CHARM 48.6 - 57.4 -
Investment property(1) 3,124.3 - 3,028.3 -
3,172.9 - 3,085.7 -
Level 2
Interest rate swaps - in cash flow hedge accounting relationships 14.1 - 19.8 -
14.1 - 19.8 -
( )
(1) Includes investment property - held for sale
The significant unobservable inputs affecting the carrying value of the CHARM
portfolio are house price inflation and discount rates. A reconciliation of
movements and amounts recognised in the consolidated income statement are
detailed in Note 16.
The investment valuations provided by Allsop LLP and CBRE Limited are based on
RICS Professional Valuation Standards, but include a number of unobservable
inputs and other valuation assumptions.
The fair value of swaps and caps were valued in-house by a specialised
treasury management system, using a discounted cash flow model and market
information. The fair value is derived from the present value of future cash
flows discounted at rates obtained by means of the current yield curve
appropriate for those instruments. As all significant inputs required to value
the swaps and caps are observable, they fall within Level 2.
Notes to the preliminary financial results continued
The reconciliation between opening and closing balances for Level 3 is
detailed in the table below:
Assets - Level 3 2025 2024
£m
£m
Opening balance 3,085.7 3,015.9
Amounts taken to income statement 30.6 (33.8)
Other movements 56.6 103.6
Closing balance 3,172.9 3,085.7
21. Tax
The tax (credit)/charge for the year of £(100.0)m (2024: £9.4m) recognised
in the consolidated income statement comprises:
2025 2024
£m
£m
Current tax
Corporation tax on profit 12.9 14.5
Adjustments relating to prior years (1.8) (7.8)
11.1 6.7
Deferred tax
Origination and reversal of temporary differences (111.7) (4.0)
Adjustments relating to prior years 0.6 6.7
(111.1) 2.7
Total tax (credit)/charge for the year (100.0) 9.4
( )
The 2025 current tax adjustments relating to prior years reflect adjustments
which have been included in submitted tax returns and primarily relate to
financing costs and capital allowances.
The Group works in an open and transparent manner and maintains a regular
dialogue with HM Revenue & Customs. This approach is consistent with the
'low risk' rating we have been awarded by HM Revenue & Customs and to
which the Group is committed.
In addition to the above, a deferred tax credit of £0.7m (2024: £6.0m) was
recognised within other comprehensive income comprising:
2025 2024
£m
£m
Remeasurement of BPT Limited defined benefit pension scheme (0.1) (0.8)
Fair value movement in cash flow hedges (0.6) (5.2)
Amounts recognised in other comprehensive income (0.7) (6.0)
Deferred tax balances comprise temporary differences attributable to:
2025 2024
£m
£m
Deferred tax assets
Short-term temporary differences 4.6 6.1
4.6 6.1
Deferred tax liabilities
Trading property uplift to fair value on business combinations (3.0) (3.9)
Investment property revaluation (1.0) (93.8)
Short-term temporary differences (2.4) (21.9)
Fair value movement in financial interest in property assets (0.7) (0.2)
Actuarial gain on BPT Limited defined benefit pension scheme (0.2) (0.2)
Fair value movement in derivative financial instruments (0.9) (1.5)
(8.2) (121.5)
Total deferred tax (3.6) (115.4)
( )
Notes to the preliminary financial results continued
As a result of conversion to REIT status, the Group has released £123.1m of
deferred tax in respect of its Property Rental Business activities, including
that related to unrealised gains on qualifying investment properties and
capital allowances in respect of those properties. In addition, a £0.5m
current tax credit has arisen in the period since conversion to REIT status,
being the tax exempt income arising in that period.
In addition to the tax amounts shown above, contingent tax based on EPRA
market value measures, being tax on the difference between the carrying value
of trading properties in the consolidated statement of financial position and
their market value has not been recognised by the Group. This contingent tax
amounts to £60.6m, calculated at 25.0% (2024: £72.1m, calculated at 25.0%)
and will be realised as the properties are sold.
22. Retirement benefits
The Group retirement benefit asset decreased from £6.5m to £6.2m in the year
ended 30 September 2025. This movement has arisen from changes in assumptions
of £1.6m and a loss on plan assets of £1.9m. The principal actuarial
assumptions used to reflect market conditions as at 30 September 2025 are as
follows:
2025 2024
% %
Discount rate 5.8 5.0
Retail Price Index (RPI) inflation 3.0 3.3
Consumer Price Index (CPI) inflation 2.3 2.6
Rate of increase of pensions in payment 5.0 5.0
23. Share-based payments
The Group operates a number of equity-settled, share-based compensation plans
comprising awards under a Long-Term Incentive Plan ('LTIP'), a Deferred Bonus
Plan ('DBP'), a Deferred Bonus Share Plan ('DBSP'), a Share Incentive Plan
('SIP') and a Save As You Earn Scheme ('SAYE'). The share-based payments
charge recognised in the consolidated income statement for the period is
£3.6m (2024: £2.8m).
24. Related party transactions
During the year ended 30 September 2025, the Group transacted with its
associates and joint ventures (details of which are set out in Notes 14 and
15). The Group provides a number of services to its associates and joint
ventures. These include property and asset management services for which the
Group receives fee income. The related party transactions recognised in the
consolidated income statement and consolidated statement of financial position
are as follows:
2025 2024
Fees Year end Fees Year end
recognised
balance
recognised
balance
£'000
£'000
£'000
£'000
Connected Living London (BTR) Limited 557 343 735 870
Lewisham Grainger Holdings LLP 140 653 226 513
Vesta LP 804 216 811 214
1,501 1,212 1,772 1,597
2025 2024
Interest Year end loan Interest Interest Year end loan Interest
recognised
balance
rate
recognised
balance
rate
£'000
£m
%
£'000
£m
%
Curzon Park Limited - 18.1 Nil - 18.1 Nil
Lewisham Grainger Holdings LLP 921 13.2 5.8 1,196 11.5 11.0
Vesta LP - 14.5 Nil - 14.5 Nil
921 45.8 1,196 44.1
EPRA Performance Measures - Unaudited
The European Public Real Estate Association (EPRA) is the body that represents
Europe's listed property companies. The association sets out guidelines and
recommendations to facilitate consistency in listed real estate reporting, in
turn allowing stakeholders to compare companies on a like-for-like basis. As a
member of EPRA, the Group is supportive of EPRA's initiatives and discloses
measures in relation to the EPRA Best Practices Recommendations ('EPRA BPR')
guidelines. The most recent guidelines, updated in September 2024, have been
adopted by the Group.
EPRA Earnings
2025 2024
Earnings Shares Pence per Earnings Shares Pence per share
£m millions share £m millions
Earnings per IFRS income statement 102.6 738.8 13.9 40.6 738.2 5.5
Adjustments to calculate adjusted EPRA Earnings, exclude:
i) Changes in value of investment properties, development properties held for (26.3) - (3.6) 38.4 - 5.2
investment and other interests
ii) Profits or losses on disposal of investment properties, development 1.6 - 0.2 5.8 - 0.8
properties held for investment and other interests
iii) Profits or losses on sales of trading properties including impairment (39.5) - (5.3) (49.3) - (6.7)
charges in respect of trading properties
iv) Tax on profits or losses on disposals - - - - - -
v) Negative goodwill/goodwill impairment - - - - - -
vi) Changes in fair value of financial instruments and associated close-out 8.5 - 1.2 6.6 - 0.9
costs
vii) Acquisition costs on share deals and non-controlling joint venture - - - - - -
interests
viii) Adjustments related to funding structure - - - - - -
ix) Adjustments related to non-operating and exceptional items 3.3 - 0.4 5.0 - 0.7
x) Deferred tax in respect of EPRA adjustments - - - - - -
xi) Adjustments i) to viii) in respect of joint ventures 3.5 - 0.5 0.9 - 0.1
xii) Non-controlling interests in respect of the above - - - - - -
EPRA Earnings/Earnings per share 53.7 738.8 7.3 48.0 738.2 6.5
EPRA Earnings per share after tax 5.5 4.9
( )
ix) Adjustments relate to fire safety provisions, REIT conversion costs and
aborted acquisition costs as outlined within the Group's consolidated income
statement.
EPRA Performance Measures - Unaudited (continued)
EPRA NRV, EPRA NTA and EPRA NDV
2025 2024
EPRA NRV EPRA NTA EPRA NDV EPRA NRV EPRA NTA EPRA NDV
£m £m £m £m £m £m
IFRS Equity attributable to Shareholders 2,039.8 2,039.8 2,039.8 1,893.7 1,893.7 1,893.7
Include/Exclude:
i) Hybrid Instruments - - - - - -
Diluted NAV 2,039.8 2,039.8 2,039.8 1,893.7 1,893.7 1,893.7
Include:
ii.a) Revaluation of IP (if IAS 40 cost option is used) - - - - - -
ii.b) Revaluation of IPUC (if IAS 40 cost option is used) - - - - - -
ii.c) Revaluation of other non-current investments 7.5 7.5 7.5 11.8 11.8 11.8
iii) Revaluation of tenant leases held as finance leases - - - - - -
iv) Revaluation of trading properties 245.4 181.8 181.8 292.4 216.4 216.4
Diluted NAV at Fair Value 2,292.7 2,229.1 2,229.1 2,197.9 2,121.9 2,121.9
Exclude:
v) Deferred tax in relation to fair value gains of IP 1.0 1.0 - 112.9 112.9 -
vi) Fair value of financial instruments (10.6) (10.6) - (14.9) (14.9) -
vii) Goodwill as a result of deferred tax - - - - - -
viii.a) Goodwill as per the IFRS balance sheet - (0.4) (0.4) - (0.4) (0.4)
viii.b) Intangible as per the IFRS balance sheet - (2.5) - - (1.4) -
Include:
ix) Fair value of fixed interest rate debt - - 49.3 - - 73.4
x) Revaluation of intangibles to fair value - - - - - -
xi) Real estate transfer tax - - - - - -
NAV 2,283.1 2,216.6 2,278.0 2,295.9 2,218.1 2,194.9
Fully diluted number of shares 742.3 742.3 742.3 743.1 743.1 743.1
NAV pence per share 307 298 307 309 298 295
EPRA Performance Measures - Unaudited (continued)
EPRA NIY
2025 2024
£m
£m
Investment property - wholly-owned 3,124.3 3,028.3
Investment property - share of JVs/Funds 67.6 66.5
Trading property (including share of JVs) 541.0 620.1
Less: developments (369.1) (401.7)
Completed property portfolio valuation 3,363.8 3,313.2
Allowance for estimated purchasers' costs 188.9 180.5
Gross up completed property portfolio valuation B 3,552.7 3,493.7
Annualised cash passing rental income 177.6 166.1
Property outgoings (48.8) (48.8)
Annualised net rents A 128.8 117.3
Add: rent incentives 0.7 0.2
'Topped up' net annualised rents C 129.5 117.5
EPRA NIY A/B 3.6% 3.4%
EPRA 'topped up' NIY C/B 3.6% 3.4%
Gross up completed property portfolio valuation 3,552.7 3,493.7
Adjustments to completed property portfolio in respect of regulated tenancies (545.2) (634.5)
Adjusted gross up completed property portfolio valuation b 3,007.5 2,859.2
Annualised net rents 128.8 117.3
Adjustments to annualised cash passing rental income in respect of newly 6.6 8.3
completed developments and refurbishment activity
Adjustments to property outgoings in respect of newly completed developments (1.9) (2.4)
and refurbishment activity
Adjustments to annualised cash passing rental income in respect of regulated (13.3) (15.0)
tenancies
Adjustments to property outgoings in respect of regulated tenancies 3.4 4.5
Adjusted annualised net rents a 123.6 112.7
Add: rent incentives 0.7 0.2
EPRA 'topped up' NIY c 124.3 112.9
Adjusted EPRA NIY a/b 4.1% 3.9%
Adjusted EPRA 'topped up' NIY c/b 4.1% 3.9%
EPRA Vacancy Rate
2025 2024
£m
£m
Estimated rental value of vacant space A 2.5 3.3
Estimated rental value of the whole portfolio B 130.0 122.9
EPRA Vacancy Rate A/B 1.9% 2.7%
The vacancy rate reflects estimated rental values of the Group's stabilised
habitable PRS units as at the reporting date.
EPRA Performance Measures - Unaudited (continued)
EPRA Cost Ratio
2025 2024
£m
£m
Administrative expenses 36.7 35.3
Property operating expenses 46.6 44.7
Share of joint ventures expenses 1.0 0.6
Management fees (2.3) (2.6)
Other operating income/recharges intended to cover overhead expenses (3.8) (5.5)
Exclude:
Investment property depreciation - -
Ground rent costs (0.2) (0.1)
Costs (including direct vacancy costs) A 78.0 72.4
Direct vacancy costs (3.0) (2.4)
Costs (excluding direct vacancy costs) B 75.0 70.0
Gross rental income 170.2 154.8
Less: ground rent income (0.6) (0.6)
Add: share of joint ventures (gross rental income less ground rents) 0.8 0.8
Add: adjustment in respect of profits or losses on sales of properties 37.3 43.6
Gross Rental Income and Trading Profits C 207.7 198.6
Adjusted EPRA Cost Ratio (including direct vacancy costs) A/C 37.6% 36.5%
Adjusted EPRA Cost Ratio (excluding direct vacancy costs) B/C 36.1% 35.2%
EPRA LTV
2025
£m Group Share of Joint Ventures Share of Associates Combined
Borrowings from Financial Institutions 903.0 - - 903.0
Bond loans 700.0 - - 700.0
Net payables 41.8 9.8 14.6 66.2
Exclude:
Cash and cash equivalents (126.6) (3.3) (0.3) (130.2)
Net debt A 1,518.2 6.5 14.3 1,539.0
Investment properties at fair value 2,858.1 - 14.9 2,873.0
Investment properties under development 266.2 52.7 - 318.9
Properties held for sale 541.0 - - 541.0
Financial assets 94.4 - - 94.4
Total property value B 3,759.7 52.7 14.9 3,827.3
EPRA LTV % A/B 40.4% 12.3% 96.0% 40.2%
EPRA Performance Measures - Unaudited (continued)
2024
£m Group Share of Joint Ventures Share of Associates Combined
Borrowings from Financial Institutions 908.2 - - 908.2
Bond loans 700.0 - - 700.0
Net payables 29.5 6.7 14.7 50.9
Exclude:
Cash and cash equivalents (140.1) (1.4) (0.5) (142.0)
Net debt A 1,497.6 5.3 14.2 1,517.1
Investment properties at fair value 2,720.2 - 14.5 2,734.7
Investment properties under development 308.1 52.0 - 360.1
Properties held for sale 620.1 - - 620.1
Financial assets 101.7 - - 101.7
Total property value B 3,750.1 52.0 14.5 3,816.6
EPRA LTV % A/B 39.9% 10.1% 97.6% 39.7%
EPRA Capital Expenditure
2025
£m Trading Properties Investment Properties Group (excl Joint Ventures) Share of Joint Ventures Combined
Acquisitions 0.1 20.0 20.1 - 20.1
Development 9.5 100.8 110.3 3.9 114.2
Completed assets
- Incremental letting space - - - - -
- No incremental letting space 2.3 17.2 19.5 0.2 19.7
- Tenant incentives - - - - -
- Other material non-allocated types of expenditure - - - - -
Capitalised interest - 10.4 10.4 0.5 10.9
Total capital expenditure 11.9 148.4 160.3 4.6 164.9
2024
£m Trading Properties Investment Properties Group (excl Joint Ventures) Share of Joint Ventures Combined
Acquisitions 0.2 85.9 86.1 - 86.1
Development 11.0 149.6 160.6 1.2 161.8
Completed assets
- Incremental letting space - - - - -
- No incremental letting space 3.8 13.9 17.7 - 17.7
- Tenant incentives - - - - -
- Other material non-allocated types of expenditure - - - - -
Capitalised interest - 11.6 11.6 0.6 12.2
Total capital expenditure 15.0 261.0 276.0 1.8 277.8
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END FR FFIFAUEISESF
Copyright 2019 Regulatory News Service, all rights reservedRecent news on Grainger
See all newsREG - Grainger PLC - Preliminary Full Year Financial Results
AnnouncementREG - Grainger PLC - Director/PDMR Shareholding
AnnouncementREG - Grainger PLC - Statement on Rent Reform Bill
AnnouncementREG - Grainger PLC - Notice of Results and Investor Presentation
AnnouncementREG - Grainger PLC - Director/PDMR Shareholding
Announcement