SEGRO posted an adjusted pre-tax profit of £386m, up 8.4% compared with the previous year, for its full year results for 2022, thanks to a record £98m of new headline rent commitments.
The FTSE 100 developer said its net rental income of £522m was up 18.9% on the previous year, driven by ‘strong’ like-for-like rental growth of 6.7% coupled with development completions. It recorded £41m of new pre-let agreements and a 23% average uplift on rent reviews and renewals.
SEGRO said a market-wide yield expansion in the second half of last year, ‘partly offset by estimated rental value growth (ERV) of 10.9%, portfolio asset management successes and development profits, led to a 15.0% decrease in adjusted NAV per share to 966 pence’.
Its adjusted EPS increased by 6.5% to 31.0 pence and the 2022 full year dividend increased 8.2% to 26.3 pence. The final dividend increased by 7.7% to 18.2 pence.
David Sleath, chief executive of SEGRO, said: “SEGRO is today reporting strong operational results for 2022, including a record level of rent roll growth driven by our active asset management and a strong leasing performance. Our modern, well-located and highly sustainable warehouses continue to be in high demand from a diverse range of occupiers, underpinned by long-term structural drivers.
“Our strategy over the past decade has focused on cultivating a unique portfolio located in the most supply-constrained European urban and logistics markets, backed by a strong balance sheet to enable SEGRO to outperform through the property cycle. Our portfolio valuation fell in the second half of 2022 as investment yields rose and values weakened across the sector in response to macroeconomic conditions. However, the impact on our portfolio was mitigated by its high quality and the strong rental growth we delivered across all of our markets.
“Our prime portfolio, excellent land bank, development expertise, customer focus and balance sheet capacity mean we are well positioned to deliver attractive returns and further growth into the years ahead.”
