Workspace Group (WKP) H2 2026 earnings summary

Executive summary

• FY 2026 was challenging, with trading profit after interest down 9.4% year-on-year and net rental income down 7.1%, but operational stability was maintained.

• The business is stable but undergoing a transformation to focus on earnings and repositioning towards the structurally growing flex office market.

• Leadership has a clear strategy to modernize the product, simplify pricing, and target the SME and scale-up segment with a 'best value' proposition.

• Market opportunity remains significant, with a strategy to capitalize on evolving occupier demands in the flexible workspace sector.

Financial highlights

• Net rental income for FY 2026 was GBP 113.4 million, down 7.1% year-on-year, reflecting disposals and lower occupancy/pricing.

• Trading profit after interest was GBP 60.5 million, down 9.4% year-on-year.

• Loss before tax was GBP 120.5 million, reflecting revaluations, disposals, and exceptional items.

• Final dividend per share declared at GBP 0.167, full year dividend at GBP 0.261, down 8.1%.

• Property portfolio value declined 7% to GBP 2.1 billion; net debt reduced 7.6% to GBP 758 million.

Outlook and guidance

• FY 2027 expected to see a substantial step down in trading profit due to ongoing transition and refinancing.

• CapEx for FY 2027 budgeted at GBP 55 million, mostly for value-add projects.

• Medium-term ambition is to achieve over GBP 125 million trading profit before interest in four to six years, more than 50% above the current adjusted base.

• Dividend policy set at 1.2 times earnings cover to balance reinvestment and shareholder returns.

• £75m of disposals planned to meet a £200m target by end FY27, with over £100m further disposals under consideration.