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Sirius Real Estate Ltd on Monday reported a decline in interim profit as operating costs weighed, offsetting continued demand for space.
The London and Johannesburg-listed property investor said pretax profit fell by 3.2% to €75.7 million for the six months to September 30, from €78.2 million in the prior year.
Administrative expenses ballooned to €24.8 million from €12.3 million, while direct costs expanded to €57.4 million from €38.8 million.
Revenue leapt by 48% to €130.6 million from €88.4 million, with funds from operations rising by 47% to €48.5 million from €33.0 million.
Like-for-like annualised rent roll increased by 2.4% in Germany to €115.2 million as at September 30 from €112.5 million as at March 31, and rose by 4.1% in the UK to £46.5 million from £44.7 million.
Sirius raised its interim dividend to 2.70 euro cents, up 32% from 2.04 cents.
Adjusted earnings per share, which excludes valuation movements as well as exceptional items, increased by 27% to 3.71 cents from 2.93 cents, reflecting the positive year-on-year operational development. EPS decreased by 6.8% to 6.00 cents from 6.44 cents.
Net asset value per share inched up to 103.90 cents as at September 30, from 102.04 cents as at March 31. Sirius recorded a gain on revaluation of investments of €26.8 million, compared to €48.4 million previously.
‘Dividend and FFO growth is being supported by strong trading, with continued demand for space at our properties leading to rent roll increases and a robust leasing pipeline taking this positive momentum into the second half,’ Chief Executive Andrew Coombs said.
Looking forward, the company expects to continue to grow organically while remaining cautious on acquisitive growth until the trajectory of the UK and German markets becomes a bit clearer.
In UK, it said BizSpace’s position was very strong and anticipated continued strong trading in Germany despite the fact that a large proportion of its tenant base uses gas.
In London, Sirius shares rose 0.1% to 82.00 pence. In Johannesburg, the stock was flat at R 16.90.
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