CLS Holdings (CLI) investor relations material

Executive summary

• Strategic focus on reducing vacancy, executing property sales, completing 2025 refinancings, and investing in higher-quality, faster-growing properties for future earnings growth.

• Over half of targeted £400m property sales completed or exchanged, with £143m done in H1 and further disposals in progress to reduce LTV and fund investments.

• Strong leasing momentum with £7.5m annual rent signed, up 17% year-over-year, despite vacancy rising to 15.1% due to planned expiries; vacancy expected to decline in H2.

• Interim dividend reduced by 50% to 1.3p per share, aligning with a revised policy to retain cash for investment.

• Portfolio now split: 47% Germany, 13% France, 40% UK, reflecting recent sales and rebasing towards higher-quality assets.

Financial highlights

• EPRA NTA per share down 2.6% to 209.5p; EPRA EPS down 16.7% to 4.0p per share year-over-year.

• Net rental income fell to £53.3m from £58.9m, mainly due to disposals and expiries.

• Loan-to-value reduced to 49.2% from 50.7% at year-end; net debt dropped by £80m to £859.1m.

• Cost of debt at 3.75%, down from 3.77% at year-end; interest cover at 1.9x.

• Total portfolio value at £1.75bn, down from £1.9bn at year-end, due to disposals and valuation decreases.

Outlook and guidance

• Vacancy expected to reduce in H2 2025 and into 2026 as leasing momentum continues.

• LTV forecasted to reach 35%-45% target range by year-end as further disposals complete.

• Over 90% of 2025 debt maturities refinanced, repaid, or credit approved, with a more even debt maturity profile.

• Market fundamentals and sentiment improving, but recovery expected to be gradual; focus on unlocking value through reducing vacancy, rental growth, and development opportunities.

• Rental growth anticipated as tenants seek quality properties in prime locations.