Yahoo Finance

• Revenue: Increased 3% to GBP 42.4 million for H1 2024.

• Like-for-Like Revenue Growth: 10.5% increase.

• Gross Margin: Improved by 0.5 percentage points, expected to moderate to 70% for the full year.

• Administrative Costs: Increased 9% due to growth agenda and inflationary pressures.

• Finance Costs: Increased 10% to GBP 9.9 million, including a nonrecurring charge of GBP 0.9 million.

• EPRA Earnings: Reduced by 4%, remaining at 2.3p per share.

• Adjusted EPS: 2.4p for H1 2024, 3% ahead of 2023.

• Dividend: Increased 8% compared to the same period last year, targeting a minimum of 3.5p per share for 2024.

• Property Valuation: Increased 3.8% before multiple dwellings relief abolition.

• Net Promoter Score: Increased by 5 points to plus 37.

• Customer Satisfaction: Recorded at 87%.

• Occupancy Rates: Expected to exceed 97% for the upcoming academic year.

• Loan to Value (LTV): Increased to 33.8%, within the target range of 30% to 35%.

• Total Accounting Return: 3.2% for the period.

• EPRA NTA per Share: Increased 1.7% to 122.8p.

• CapEx Investment: Over GBP 18 million invested in key projects during H1 2024.

• Warning! GuruFocus has detected 5 Warning Sign with LSE:ESP.

Release Date: August 15, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Empiric Student Property PLC (LSE:ESP) achieved effectively full occupancy for the previous and current academic years, with expectations for the next year as well.

• The Hello Student operating platform delivered record-level rents, with academic year '24-'25 like-for-like rental growth expected to exceed 6%, significantly above inflation.

• The company completed GBP 115 million of disposals, achieving above book value in aggregate, and is redeploying capital into strong locations.

• Customer satisfaction metrics are strong, with a Net Promoter Score up 5 points to plus 37, and customer satisfaction at a high level of 87%.

• Empiric Student Property PLC (LSE:ESP) has a strong pipeline of acquisitions and refurbishments, with plans to refurbish over 500 beds in 2025 and a focus on high IRR projects.

Negative Points

• Administrative costs increased by 9%, primarily due to the group's growth agenda and inflationary pressures.

• Finance costs rose by 10% to GBP 9.9 million, including a nonrecurring charge related to recent refinancing.

• EPRA earnings were pared back by 4%, remaining at 2.3p per share, with nonrecurring items impacting the adjusted EPS.

• Higher overall drawn debt and lower cash reserves increased the loan-to-value ratio by 3 percentage points to 33.8%.

• The company faces potential challenges from rising construction costs and the risk of rent controls due to affordability concerns among students.