In This Article:
-
Trading Profit: Up 5% despite a slight decrease in rental income due to recent disposals.
-
Net Rental Income: Marginally down, offset by savings in interest costs.
-
Trading Profit After Interest: Increased by 5.1% to GBP32.7 million.
-
Adjusted Earnings Per Share: Up 5% to 16.9p.
-
Interim Dividend: Increased to 9.4p, fully covered.
-
Net Debt: Remained basically unchanged at GBP856 million.
-
Cash and Available Facilities: GBP144 million at the end of September.
-
Average Rent Per Square Foot: Grew around 6% over the last 12 months.
-
Property Valuation: Stabilized with a small decrease, NTA per share down 1.9% to GBP7.85.
-
ERV Growth: Overall increase of just over 1%, with stronger growth for smaller units.
-
Debt Facilities: Maturity of GBP135 million extended to November 2028, new GBP80 million term loan agreed.
-
Average Cost of Debt: 3.6%, with LTV at 35%.
-
Reversion Opportunity: GBP36 million potential increase in rent roll over the next three to four years.
Release Date: November 22, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Workspace Group PLC (WKPPF) reported a 5% increase in trading profit despite a slight decrease in rental income due to recent disposals.
-
The company has seen a 6% growth in average rent per square foot over the last 12 months, aligning with its long-term average.
-
Workspace Group PLC (WKPPF) has a strong operating platform that allows for significant reversion capture and rental growth through active asset management.
-
The company has a robust debt structure with significant headroom and no additional refinancing required until 2027, providing financial flexibility.
-
Workspace Group PLC (WKPPF) has a strategic focus on smaller units, which have shown strong demand and shorter void periods, contributing to rental growth.
Negative Points
-
Workspace Group PLC (WKPPF) experienced a drop in occupancy due to a higher-than-usual number of customer vacations, impacting rental income.
-
The company faces persistent wage inflation in the UK, affecting service charge costs and administrative expenses.
-
There is a noted decline in demand for larger spaces, which has been a trend over the last few years, impacting like-for-like rental growth.
-
The property valuation saw a small decrease, with NTA per share down 1.9% to GBP7.85.
-
Workspace Group PLC (WKPPF) is dealing with temporary impacts on rental and occupancy due to asset management activities and refurbishments.
Q & A Highlights
Q: How do the lettings at Leroy House compare with the Estimated Rental Values (ERVs)? A: Dave Benson, CFO, stated that the lettings are within a range, with some significantly ahead of ERV. The focus is on letting up the space first and then driving rents, and overall, the lettings are performing well.