Urban Logistics REIT (SHED) H1 2025 earnings summary

Executive summary

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

• H1 2024 saw gross rental income up 3.0% to £30.6m and adjusted EPS up 3.2% to 3.57p, with net rental income up 1.8% year-over-year.

• 27% reversionary potential in the portfolio, with £7.1m of reversion to be captured before year-end, supporting future earnings growth.

• Active capital recycling: £45.8m of acquisitions at 6.7% NIY and £7.7m of disposals at 4.85% NIY, releasing capital for accretive investments.

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

Financial highlights

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

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

• Loan to value increased to 33.2% (from 29.3% in March); 100% of debt now fixed or hedged.

• Interest cover ratio at 3.2x; weighted average cost of debt at 3.9%.

• 13 lease events in H1 generated £1.2m in additional rental income, with a 21% like-for-like increase.

Outlook and guidance

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

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

• 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.

• Dividend expected to be maintained at 7.6p per share for the full year.