Regional REIT (RGL) H1 2025 earnings summary

Executive summary

• Strategic repositioning and portfolio transition advanced, focusing on core assets, targeted CapEx, value-add opportunities, and maintaining a fully covered dividend.

• Portfolio segmentation includes core, CapEx-to-core, value-add, and disposals, with significant CapEx deployed and asset sales realized in H1 2025.

• Market conditions remain challenging due to geopolitical uncertainty, weak UK government, and subdued investment activity, but optimism is rising with stabilizing yields and improving occupational demand.

• Commitment to a fully covered dividend, ongoing refurbishment, and ESG initiatives to strengthen core assets and support long-term value.

• Total Shareholder Return for H1 2025 was +9.6%, outperforming the FTSE EPRA NAREIT UK Index.

Financial highlights

• EPRA NTA at £328.7m (202.8p/share), down from £340.7m (210.2p/share) at year-end 2024; IFRS NAV at £335.9m (207.2p/share).

• EPRA EPS at 5.2p, IFRS EPS at -4.9p; rental and property income was £29.8m (H1 2024: £32.2m).

• Dividend of 5.0p per share declared for H1 2025, fully covered by earnings; full-year dividend guidance reaffirmed at 10p.

• Net LTV increased to 43.2% (from 41.8%), with gross borrowings reduced to £310.0m.

• EPRA cost ratio (including vacancy costs) rose to 52.6% (H1 2024: 40.6%).

Outlook and guidance

• Income guidance for 2025 revised down due to tenant breaks, but dividend will be maintained and covered.

• Strategic sales programme targets £40m–£50m annual disposals to reduce debt; significant new letting opportunities expected to benefit 2026.

• Focus on increasing occupancy, rental growth, and EPC improvements, with CapEx and refurbishment programs expected to drive future gains.

• LTV targeted to fall below 40% over the medium term, contingent on asset sales.

• Board confident in ability to deliver long-term value and well positioned for emerging opportunities.