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Financial highlights
 
Alternative performance measures Half-year to 30 September 2022 Half-year to 30 September 2021 Change
Dividend per share 3.15p 3.00p +5.0%
Total accounting return 0.1% 9.0% -8.9pts
EPRA EPS 3.6p 2.8p +28.6%
Adjusted cash EPS 3.1p 2.6p +19.2%
EPRA cost ratio 12.6% 17.3% -4.7pts
As at 30 September 2022 As at 31 March 2022 Change
Portfolio value 1 £3,656.6m £1,544.4m +136.8%
EPRA NTA per share (ex-dividend) 2 139.7p 142.6p -2.0%
Pro forma net LTV 3 33% 22% +11pts
IFRS performance measures Half-year to 30 September 2022 Half-year to 30 September 2021 Change
Rental income £75.5m £25.4m +197.2%
Operating profit before fair value changes £66.0m £21.0m +214.3%
IFRS EPS -2.3p 11.3p -120.4%
As at 30 September 2022 As at 31 March 2022 Change
Investment property at fair value 1 £3,911.3m £1,499.1m +160.9%
Net assets £2,448.2m £1,300.7m +88.2%
NAV per share 142.8p 142.7p +0.1%
  • Dividends per share totalled 3.15p in respect of the half-year (30 September 2021: 3.00p per share), which represents 5% growth on the previous six-months
  • Total net tangible asset (“NTA”) return of 0.1% for the half-year (30 September 2021: 9.0%)
  • Since IPO, the Group has delivered an annualised total accounting return of 10.1% pa compounded, well ahead of our 8%+ medium term target4
  • EPRA earnings per share (“EPS”) were 3.6p and Adjusted cash EPS were 3.1p for the half-year (30 September 2021: 2.6p), representing full dividend cover for the period. The current run rate is materially higher than these figures given the period (i) only included two months of the merger efficiencies and benefits5, (ii) reflected deployment of a significant capital raise, and (iii) did not include the earnings accretive ‘income strip’ sale which completed following the period end
  • Portfolio independently valued at £3,656.6m, reflecting a six-month like for like change of -1.4%. The movement reflects an outward yield shift of 40 bps to 4.9% at 30 September 2022 (31 March 2022: 4.5%), offset by 2.5% like for like rental growth6
  • The Group’s net assets increased by 88.2% to £2,448.2m (31 March 2022: £1,300.7m), driven predominantly by the share for share element of the merger with Secure Income REIT plc (“SIR plc”) (the “Merger”)
  • EPRA NTA per share (ex-dividend)2 of 139.7 p (31 March 2022: 142.6p), reflecting a half-year decline in value of 2.0%, primarily driven by yield expansion across certain property sectors in response to wider economic conditions and the costs associated with the Merger, which represented less than 1% of the combined portfolio value1 offset by the value generated by the Merlin ‘income strip’ sale
  • Pro forma net loan to value (“LTV”)3 ratio of 33% (31 March 2022: 22%), with significant headroom to our medium-term borrowing policy cap of 40% and substantial covenant headroom. We remain committed to a conservative medium-term LTV target of 30%
The UK’s leading sector diversified REIT
  • During the period, LXi REIT plc merged with Secure Income REIT plc to create the UK’s leading sector-diversified, long income REIT, with a substantial, defensive and resilient portfolio
  • The scale achieved provides a strong foundation to deliver secure attractive long-dated and growing income returns and capital protection to our shareholders
  • The Group owns an inflation-protected portfolio of 348 properties that are 100% occupied with an aggregate valuation of £3.7bn at 30 September 2022, contracted annual rental income of £200.7m and a WAULT to first break of 26 years
  • Our assets are well diversified across a broad range of resilient sub-sectors with high barriers to entry, strong underlying property fundamentals and low starting rents, and are let on very long-term leases to tenant counterparties that have demonstrated strong performance throughout previous economic cycles
  • Our properties are strategically important to the operations of our broad range of institutional-quality tenants
  • Our shareholders continued to benefit from the certainty provided by the Group’s highly diversified, triple-net portfolio of secure real estate assets, our conservative and 100% fixed or capped debt position and our very low cost base
Portfolio summary
 
As at 30 September 2022 As at 31 March 2022
WAULT to first break 26 years 21 years
Number of assets 348 193
Number of tenants 83 71
Let or pre-let 100% 100%
Portfolio diversification by sector (by contracted annual rent)
Healthcare 22% 8%
Budget hotels 21% 13%
Theme parks 19% -
Foodstores 9% 25%
Industrials 7% 18%
Others 22% 36%
Rent review type (upward only)
RPI 41% 54%
CPI 23% 19%
Fixed 34% 23%
Open market 2% 4%
Regular predictable rental growth profile
Annual reviews 57% 37%
Five-yearly reviews 43% 63%
Capped indexed linked uplifts 44% 67%
Average cap 3.8% 3.6%
Collared index-linked uplifts 40% 54%
Average collar 1.3% 1.5%
Post year end highlights
Dividends
  • Announced a dividend of 1.575p per share for the quarter ended 30 September 2022, keeping the Company on track to meet its annual dividend per share target of 6.3p4
Debt and hedging
  • Following completion of the Merlin ‘income strip’ sale, the Group repaid in full the outstanding facility amount of £232m plus break costs on Merlin A Sterling facility. Break costs are fully provided in the Company’s accounts to 30 September 2022 and the pro forma net LTV of 33% is stated after accounting for this transaction
  • Closed out the related interest rate cap, receiving proceeds £23.1m net of costs used to pay down the Company’s revolving credit facility
      Previous Financial Reports and Presentations
      Date
      Financial Reports and Presentations
      31 March 2022
      Annual report 31 March 2022
      31 March 2022
      Annual results presentation 31 March 2022
      31 March 2022
      Preliminary results announcement 31 March 2022
      30 September 2022
      Interim results presentation 30 September 2022
      30 September 2022
      Interim results 30 September 2022 RNS
      30 September 2022
      Interim report 30 September 2022
      Date
      Financial Reports and Presentations
      31 March 2021
      Annual report 31 March 2021
      31 March 2021
      Preliminary results announcement 31 March 2021
      31 March 2021
      Annual results presentation 31 March 2021
      30 September 2021
      Interim report 30 September 2021
      30 September 2021
      Interim results  30 September 2021 RNS
      30 September 2021
      Interim results presentation 30 September 2021
      Date
      Financial Reports and Presentations
      31 March 2020
      Annual report 31 March 2020
      31 March 2020
      Preliminary results announcement 31 March 2020
      31 March 2020
      Annual results presentation 31 March 2020
      30 September 2020
      Interim report 30 September 2020
      30 September 2020
      Preliminary interim results announcement 30 September 2020
      30 September 2020
      Interim results presentation 30 September 2020
      Date
      Financial Reports and Presentations
      31 March 2019
      Annual report 31 March 2019
      31 March 2019
      Preliminary results announcement 31 March 2019
      31 March 2019
      Annual results presentation 31 March 2019
      30 September 2019
      Interim report 30 September 2019
      30 September 2019
      Preliminary interim results announcement 30 September 2019
      30 September 2019
      Interim results presentation 30 September 2019
      Date
      Financial Reports and Presentations
      31 March 2018
      Annual report 31 March 2018
      31 March 2018
      Preliminary results announcement 31 March 2018
      31 March 2018
      Annual results presentation 31 March 2018
      30 September 2018
      Interim report 30 September 2018
      30 September 2018
      Preliminary interim results announcement 30 September 2018
      30 September 2018
      Interim results presentation 30 September 2018
      Date
      Financial Reports and Presentations
      30 September 2017
      Interim report 30 September 2017
      30 September 2017
      Preliminary interim results announcement 30 September 2017
      1 The portfolio valuation includes forward funding commitments and assets held for sale. A reconciliation between portfolio value and investment property at fair value and IFRS is included in Note 8 to the condensed consolidated financial statements
      2 The EPRA NTA per share (ex-dividend) is stated after deducting the dividend of 1.575p per share in respect of the quarter ended 30 June 2022, that went ex-dividend on 29 September 2022 and was paid on 18 November 2022
      3 Pro forma net LTV is stated after adjusting the value of investment properties (the denominator) for property transactions that have exchanged but not completed and for costs to complete forward funded assets and net debt (the numerator) for property transactions that have exchanged but not completed plus associated transaction costs and for costs to complete forward funded assets
      4 These are targets and not profit forecasts
      5 The Merger documents included a quantified financial benefit statement that set out the Directors’ expectation that the Merger would deliver potential annual administrative cost savings of approximately £8.6m
      6 Like for like statistics presented in this report are calculated by reference to combined independent valuations included in the public merger documents performed by Knight Frank in respect of LXi REIT plc and CBRE in respect of Secure Income REIT plc as at 31 March 2022