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Continued strong performance on all fronts: Half Year Results 2014 – 29 August 2014

11 November 2016

The Unite Group plc, the UK’s leading developer and manager of student accommodation, announces its half year results for the six months to 30 June 2014.


Strong financial performance

  • EPRA earnings up 34% to £20.4 million (30 June 2013: £15.2 million)
  • EPRA earnings per share up 17.2% to 10.9 pence (30 June 2013: 9.3 pence)
  • EPRA NAV per share up 5.2% to 402 pence (31 December 2013: 382 pence) equating together with dividends to a total return of 6.1% on opening NAV per share for the six months (30 June 2013: 4.0%)
  • On track to achieve like-for-like rental growth of at least 3% for the full year
  • Interim dividend increased by 37.5% to 2.2 pence per share (2013 interim: 1.6 pence)
  • Bringing forward 4.5% EPS yield target by a year to 2014

Capital structure strengthened and simplified

  • See-through adjusted LTV reduced to 44% (31 December 2013: 49%)
  • Number of co-investment vehicles reducing from four to two following sale of the OCB joint venture properties and increase in UCC stake to 50% triggering merger with LSAV
  • Unite stake in USAF increased to 21% as part of wider £115 million capital raise by the fund

Further enhancements to quality portfolio

  • Four regional development projects contractually secured totalling c.2,300 bed spaces for delivery in 2016
  • Two further development projects secured under lock-out agreements expected to total approximately 1,000 bed spaces
  • Planning consents achieved on LSAV London projects comprising 1,600 bed spaces for delivery in 2016
  • High quality 3,000 bed regional portfolio acquired by USAF in July

Well positioned for continued growth

  • Reservations for the 2014/15 academic year at 92%, compared to 90% at the same time last year and supportive of rental growth of at least 3% for the full year
  • Secured development pipeline on track to add 32 pence per share to NAV and 12 pence per share to earnings by 2017 if expected returns are achieved
  • Government policy increasing funded places for 2014/15 and removing the cap on 2015/16 places, expected to translate strong demand into higher student numbers in the coming years
  • “Home for Success” brand investment programme launched to capitalise on and strengthen market position and build further on highest ever customer satisfaction levels

Mark Allan, Chief Executive of Unite Group commented: 

“During the first half of 2014, our business has continued to perform well in all areas as reflected in the growth reported in both earnings and NAV over the period. Our primary financial objective remains to continue to grow recurring earnings and cashflow sustainably. Given the positive rental growth outlook, a growing development pipeline and USAF’s recent acquisition of a high quality regional portfolio, we retain strong momentum and are now targeting a 4.5% EPS yield on NAV for 2014, a year ahead of our previous plans.

“Our strategy is underpinned by three key priorities: to be the most trusted brand in our sector, to maintain the highest quality portfolio and to have the strongest capital structure. We continue to make excellent progress and are confident about our ability to deliver our strategy against a strong market backdrop.”

Read the complete 2014 Interim Statement.