Photo by: Stenprop
Dual-listed property company Stenprop delivered strong growth in the financial year ended March 31, with pro forma headline earnings of €21-million and diluted headline earnings a share of €0.08.
The Europe-focused group, which was listed on the AltX, said its European Public Real Estate Association (EPRA) net asset value of €1.65 a share was up by 20.44% on the €1.37 issue price of the shares. Diluted adjusted EPRA earnings were €0.10 apiece, equating to a 7.16% earnings yield on the issue price of €1.37.
“We have delivered good growth to date, which is underpinned by our diversified, high-quality and defensive portfolio, which is internally managed to extract maximum value,” Stenprop CEO Paul Arenson said in a statement.
At end-March, the company’s portfolio was independently valued at €807-million, with 42% of its assets in the UK, 38% in Germany and 20% in Switzerland.
The gross lettable area stood at about 240 500 m2, generating a yearly gross rent of €52.4-million, predominantly in the office and retail sectors, which accounted for 51% and 34% of rental income respectively.
The company earlier this year stated that it would have a bullish approach to the acquisition market in the year ahead, adding to its Stenham transaction, which entailed the acquisition of 45 buildings in Germany, Switzerland and the UK, through the issue of Stenprop shares worth €318.8-million at €1.37 a share.
“The acquisition of the Stenham portfolio was transformational for the company and gave us the platform from which to continue driving value creation by executing several strategic transactions,” Arenson added.
Asked whether this bullish outlook would be the status quo for the remainder of the year, Arenson told Engineering News Online that the company would now be very selective with its acquisitions.
“We have quite a nice pipeline, but as the year has gone on, property prices have increased and it’s harder to see value, so we are being a bit more cautious [and] going to be even more selective going forward,”
He added that he did not foresee the company moving into other markets, such as South Africa. “I think we are going to stick to the markets that we know for the near future. It’s not easy to enter into new markets. We’ve been in these markets for 20 years and we’ve got the scars to show for it. It took a long time to build up expertise and local knowledge, so you have to go carefully and cultivate local connections and networks,” he pointed out.
After having completed a successful capital raise of €35-million on the AltX in March, Stenprop acquired a 50% interest in 25 Argyll Street – a £75-million multilet office building in the heart of London’s West End, in May.
It also notarised the acquisition of Hermann Quartier, a retail shopping centre located in the high street of Neukoelln, Berlin for €22.7-million.
Stenprop’s average loan to value ratio at end-March, taking joint ventures and associates into account, was 53.8%. The weighted average debt maturity stood at 2.2 years with an all-in yearly contracted weighted average cost of debt of 3.07%.
“We have started the year with a healthy cash position. We will continue to focus on nurturing our diversified portfolio of quality investment properties to deliver sustainable and growing earnings, distributions and capital growth, and will seek to bolster this with strategic acquisitions,” Stenprop CFO Patsy Watson said.