REG - Sirius Real Estate - Trading Update

Sirius Real EstateAnnouncement

07/10/2024 07:00

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RNS Number : 0845H  Sirius Real Estate Limited  07 October 2024

SIRIUS REAL ESTATE LIMITED

(Incorporated in Guernsey)

Company Number: 46442

JSE Share Code: SRE

LSE (GBP) Share Code: SRE

LEI: 213800NURUF5W8QSK566

ISIN Code: GG00B1W3VF54

 

7 October 2024

Sirius Real Estate Limited

("Sirius Real Estate", "Sirius", the "Group" or the "Company")

 

Trading Update for half year ended 30 September 2024

 

5.5%* increase in Group like-for-like rent roll

 

Sirius Real Estate, the leading owner and operator of branded business and
industrial parks providing conventional space and flexible workspace in
Germany and the U.K., provides an update on trading for the six months ended
30 September 2024.

 

The Group has achieved a 14.9%* year-on-year increase in rent roll, partly
driven by the ongoing successful asset acquisition programme.  On a
like-for-like basis, rent roll increased by 5.5%*, reflecting our ability to
continue to drive organic growth across both Germany and the U.K. The Group
remains on track to deliver full year results in line with expectations.

 

In Germany, which has marginally outperformed the U.K., rent roll growth
particularly benefited from stronger rates, despite expected regular move-outs
at the beginning of the period which slowed growth in occupancy. We expect to
see occupancy strengthen in line with seasonal trends in the second half of
the Company's financial year. With inflation now back to pre-Covid levels, we
have again demonstrated the strength of our in-house asset management platform
by leveraging product mix and occupancy carefully alongside rates to optimise
yield and the best overall returns from our space. We expect to see our
property values increase in Germany this year as the transactional market is
notably more active and confidence in the real estate sector further improves.

 

In the U.K., like-for-like rates continue to grow strongly, ahead of overall
rent roll growth, but similar to what we have seen in Germany, some seasonal
move outs have impacted occupancy.  We expect to see valuations stabilise, in
contrast to recent periods, and believe the improving transactional market
will build further confidence. Overall, we expect to announce a positive
valuation movement at Group level at the period end.

 

In July 2024, the Group successfully completed an equity fundraising of €180
million (£152.5 million) to provide funds to execute on a pipeline of
attractive acquisition opportunities, following the successful deployment of
the proceeds of our November 2023 fundraise.  We are in exclusivity on
several promising asset acquisitions in both Germany and the U.K. and we
expect to notarise and/or complete on a number of those in the coming months.

 

The Group's balance sheet remains strong with free cash reserves of
approximately €297 million as at 30 September 2024 and no significant debt
maturities until June 2026. The Group's weighted average cost of debt is 2.1%,
with a weighted average debt expiry of 3.5 years.  This follows the
successful bond issuance in May 2024 of €59.9 million nominal value notes
which were consolidated and form a single series with the €300 million
1.75% bonds due November 2028.

 

Commenting on trading during the period, Andrew Coombs, Chief Executive
Officer of Sirius Real Estate, said: "During the first half of our financial
year we have continued to perform well, with our asset management team once
again driving like-for-like rent roll growth well ahead of inflation.  This
organic growth alongside the rental contribution from the well timed series of
acquisitions we have made in recent months combined to drive an almost 15%
increase in overall rent roll, underlining the continued demand for space
within our portfolio.  Bolstered by our successful bond issuance in May and
equity raise in July, our balance sheet remains strong and we are well placed
to continue to act on opportunities to make accretive acquisitions arising
from the current market conditions."

 

Half Year Results

 

Sirius will announce results for the six months ended 30 September 2024 on
Monday, 18 November 2024, at which time there will be an in-person
presentation and a virtual webinar for analysts and investors.

 

The financial information on which this trading update is based has not been
reviewed or reported on by the Company´s external auditors or a reporting
accountant.

 

*Group rent roll has been translated utilising a constant foreign currency
exchange rate of GBP:EUR 1.197, being the closing exchange rate as at 30
September 2024.

 

 

For further information:

Sirius Real Estate

Andrew Coombs, CEO / Chris Bowman, CFO

+44 (0) 20 3059 0855

 

FTI Consulting (Financial PR)

Richard Sunderland / Ellie Sweeney / James McEwan

+44 (0) 20 3727 1000

SiriusRealEstate@fticonsulting.com

 

NOTES TO EDITORS

About Sirius Real Estate

Sirius is a property company listed on the main and premium market of the
London Stock Exchange and the main board of the JSE Limited. It is a leading
owner and operator of branded business and industrial parks providing
conventional space and flexible workspace in Germany and the U.K. As of 31
March 2024, the Group's portfolio comprised 142 assets let to 9,654 tenants
with a total book value of over €2 billion, generating a total annualised
rent roll of €194.7 million. Sirius also holds a 35% stake in Titanium, its
€350+ million German-focused joint venture with clients of AXA IM Alts.

 

The Company's strategy centres on acquiring business parks at attractive
yields and integrating them into its network of sites - both under the Sirius
and BizSpace names and alongside a range of branded products. The business
then seeks to reconfigure and upgrade existing and vacant space to appeal to
the local market via intensive asset management and investment and may then
choose to refinance or dispose of assets selectively once they meet maturity,
to release capital for new investment. This active approach allows the Company
to generate attractive returns for shareholders through growing rental income,
improving cost recoveries and capital values, and enhancing returns through
securing efficient financing terms.

 

For more information, please visit: www.sirius-real-estate.com
(http://www.sirius-real-estate.com/)

 

Follow us on LinkedIn at https://www.linkedin.com/company/siriusrealestate/
(https://www.linkedin.com/company/siriusrealestate/)

 

Follow us on X (Twitter) at @SiriusRE

 

JSE Sponsor

PSG Capital

 

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