Land Securities Group (LAND) H1 2025 earnings summary

Executive summary

• Like-for-like net rental income grew 3.4% year-over-year, with return on equity at 3.9% for the half year and EPS guidance raised due to strong operational execution and cost efficiencies.

• Portfolio repositioning towards high-quality, higher-return assets and robust demand in prime retail and London offices drove outperformance versus the wider market.

• Major retail and prime London offices remain key investment focuses, with a growing residential pipeline and over 6,000 homes planned.

• On-site with £850m of London projects and ability to invest £1bn+ in residential by 2030.

• Confidence in deploying further capital in the second half, supported by a strong capital base.

Financial highlights

• EPRA earnings for the half year were £186m, with EPRA EPS at 25.0p, and dividend per share up 2.2% to 18.6p.

• Gross rental income decreased by £21m to £302m due to non-core asset sales and lower surrender premiums, but like-for-like income increased by £7m.

• EPRA NTA per share rose 1.4% to 871p, with portfolio value up 0.9%.

• LTV at 34.9%, net debt/EBITDA at 7.4x, and interest cover at 3.8x.

• EPRA cost ratio reduced to 20.8% from 23%, with administrative expenses down 10%.

Outlook and guidance

• FY25 EPRA EPS expected to be in line with FY24, with FY26 ahead, before any upside from acquisitions.

• Like-for-like net rental income growth for FY25 now expected closer to 4%, up from previous guidance of 2.8%.

• Dividend growth targeted at low single digits, supported by improved operational efficiencies.

• ERV growth guidance remains low- to mid-single-digit percentage across the portfolio.

• Well placed to deliver 8-10% ROE target and further EPS growth.