NewRiver REIT chief executive Allan Lockhart said it had been a “transformational period” for the business as it announced its results for the six months to 30 September and the completion of its £151m acquisition of Capital & Regional.
NewRiver reported an IFRS profit after tax of £8.2m for the period, compared with a loss of £2.6m in the same period last year. It attributed its improved performance to material earnings accretion, opportunities to add value and the expansion of NewRiver’s Capital Partnerships business through the acquisition of Ellandi earlier this year for an initial cash consideration of £5m.
It added that the acquisition of Capital & Regional had increased the size of NewRiver’s portfolio by 65%, taking it to £0.9bn in value. The company said it expected to unlock approximately £6.2m of cost savings on an annual basis within 12 months of completion of the deal.
Allan Lockhart, chief executive of NewRiver REIT, said: “This has been a transformational period for NewRiver marked by the successful acquisition of Capital & Regional, which completed earlier this week. This transaction substantially increases our scale and will deliver significant benefits including a material increase in our earnings. This was clearly recognised by existing shareholders and new investors who overwhelmingly supported our equity raise to partly fund the transaction.
“Our focus on M&A activity has not detracted from our operational performance which has been excellent with another good period of leasing activity. Consequently, occupancy and occupier retention rates remain high. We have a highly experienced asset management team, which has been further enhanced with the recent acquisition of Ellandi, and a portfolio that is significantly outperforming the market in terms of year-on-year consumer spending growth which is supporting the success of our occupiers.
“For NewRiver, the outlook is positive, despite the uncertain macro environment. We have a clear pathway to deliver growth from a portfolio that is performing well, our successful capital partnership business and the realisation of the significant benefits that flow from our completed M&A activities, all of which will drive significant recurring earnings accretion, enhancing our ability to pay a higher covered dividend.”
