Urban Logistics REIT (SHED) H1 2025 earnings summary

Executive summary

• Gross rental income increased by 3.0% to £30.6m and adjusted EPS rose by 3.2% to 3.57p, with portfolio reversion at 27% and £7.1m of reversion to be captured before year-end, supporting future earnings growth.

• Active capital recycling included £45.8m of acquisitions at a 6.73% net initial yield and £7.7m of disposals at 4.85% NIY, releasing capital for higher-yielding investments.

• Portfolio focused on single-let, last mile logistics with >99% rent collection and 94% of rent rated low to moderate credit risk.

• Vacancy rate increased to 8.1% (from 5.8% in March), but is forecast to fall in 2025 as take-up outpaces new supply.

• Completed refinancing reduced margin by 47bps, extended maturity to August 2027, and increased facility size.

Financial highlights

• Gross rental income: £30.6m (+3.0% YoY); net rental income: £29.0m (+1.8% YoY); adjusted EPS: 3.57p (+3.2% YoY).

• EPRA NTA per share: 158.05p (down from 160.27p in March) due to uncovered dividend and acquisition costs.

• Loan to value: 33.2% (within 30-40% target range); all debt fixed or hedged; weighted average cost of debt: 3.9%-4.0%.

• Interest cover: 3.2x; weighted average debt maturity: 5.1 years; first maturity in August 2027.

• WAULT: 7.6 years; 99.6% of H1 rents collected.

Outlook and guidance

• 27% portfolio reversion provides a platform for further rental and earnings growth, with 46% of reversion available to capture in this financial year.

• Vacancy expected to decline in 2025 as demand remains robust and supply is constrained.

• Continued focus on acquiring assets with reversionary potential and recycling capital into higher-yielding opportunities.

• No refinancing events until August 2027; fixed debt costs provide earnings security.

• Ongoing ESG initiatives to improve EPC ratings and reduce carbon intensity, with 60% of portfolio at A/B rating.