The PRS REIT (PRSR) H1 2024 earnings summary

Executive summary

• Largest UK portfolio of single-family rental homes, with 5,306 completed and 270 under way as of March 2024, targeting 5,600+ homes and £64.2m ERV per annum.

• High occupancy (96-97%), 99% rent collection, and 11.6% like-for-like rental growth year-over-year to February 2024.

• Dividend target of 4p per share for FY2024, fully covered from March 2024 on EPRA EPS run-rate basis.

• Award-winning tenant service and strong ESG credentials, with 87% of homes rated EPC A/B.

• Portfolio is geographically diversified, mainly in North West and Midlands, supporting stable long-term income.

Financial highlights

• H1 2024 revenue £28.1m, up 16% year-over-year; net rental income £22.9m, up 17%.

• Operating profit £39.2m (+73%), profit before tax £30.3m (+106%), basic EPS 5.5p (+104%), EPRA EPS 1.8p (+13%).

• Net assets at 31 Dec 2023: £679m (+6% year-over-year); IFRS and EPRA NTA per share 123.6p (+6%).

• Gross gearing (LTV) at 38% (2022: 36%), with cost base largely fixed.

• Dividend of 2p per share in H1; FY24 target 4p per share.

Outlook and guidance

• Prospects for build-to-rent assets remain strong due to market undersupply and robust demand.

• Dividend target of 4p per share for FY2024 expected to be fully covered by EPRA EPS run-rate from March 2024.

• As interest rates reduce, real estate yields are expected to strengthen.

• Funding for remaining portfolio delivery is available and committed.

• Focus on further rental growth, high occupancy, and maintaining affordability.