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Full year results for the year to 31 December 2017 – 21 February 2018

20 February 2018



Richard Smith, Chief Executive of Unite Group, commented:

“I am pleased to report on another successful year for Unite. Our continuing focus is to deliver sustainable growth in our recurring earnings and cash flows. Our strong results are underpinned by our brand, our sector leading operating system, our deep and valuable University relationships and sector fundamentals. These factors combine in our purpose, to provide all students who live with us a Home for Success.

“We continue to align our high-quality portfolio to the strongest Universities in the UK where student demand is at its strongest. During the year, we made significant progress with our University partnerships and further increased the proportion of our beds secured under nomination agreements to 60%. This, alongside our development pipeline, is a key driver of continued growth and forward visibility of our earnings.

“Looking ahead, the business remains in a good position. Reservations for the 2018/19 academic year are at record levels for this time of year, supporting our rental growth guidance of 3.0-3.5% on a like-for-like basis. Our secured development and University partnerships pipeline of 9,400 beds, delivering over the next four years, will further improve operating efficiency, margins and earnings growth. This, coupled with a positive outlook for the student accommodation sector, reinforces our ongoing confidence in our business and is reflected in a 26% increase in our dividend and a sustainable increase in the future pay-out ratio.”

Operational delivery drives continued strong financial performance

Year ended 31 December 31 December 2016 Change
EPRA earnings* £70.5m £62.7m +12%
EPRA earnings per share* 30.3p 28.4p +7%
Profit before tax £229.4m £201.4m +14%
Dividend per share 22.7p 18.0p +26%
Total accounting return* 14% 15%  
Like-for-like rental growth* 3.4% 3.8%  
As at 31 December 2017 31 December 2016 Change
EPRA NAV per share* 720p 646p +11%
Net debt* £803m £776m +3%
Loan to value* 31% 34%  


EPRA Earnings up 12% to £70.5m (2016: £62.7m)

  • EPRA earnings now represent one-third of total shareholder return
  • Like-for-like rental growth of 3.4% (2016: 3.8%)
  • Profit before tax up 14% to £229.4 million (2016: £201.4 million)

Dividend increased 26% to 22.7p, dividend pay-out to increase to 85% from 2018

  • Increase in final dividend to 15.4p (2016: 12.0p)
  • Dividend pay-out to increase to 85% of EPRA earnings from the current level of 75%
  • 14% total accounting return (2016: 15%)

Record level of reservations for 18/19 academic year supports rental growth outlook

  • Reservations for 2018/19 academic year at 75%, a record level for this time of year (2016: 73%)
  • Supports rental growth outlook for 2018/19 of 3.0-3.5% on a like-for-like basis

Earnings growth underpinned by nomination agreements, development pipeline & improved margins

  • Nomination agreements with Universities now represent 60% of accommodation (2016: 58%), with an average remaining life of six years (2016: six years) providing income and rental growth certainty on over half of revenue
  • Secured development pipeline of 7,550 beds for delivery over the next three years (2016: 7,000 beds), generating an attractive 8.1% yield on cost
  • Together with rental growth, these new openings net of disposals could add 13p to 17p to earnings per share over the next few years
  • Delivery of £5 million of operational efficiencies (Unite share: £3.8 million) in 2017 will improve margin from 74.1% and overhead efficiency from 40bps to targets of 75% and 25-30bps in 2018

Significant progress with University partnerships

  • Acquisition of Aston Student Village (3,067 beds), delivering returns ahead of plan
  • A new development-led partnership secured with Oxford Brookes University with planning in place to deliver 887 beds in 2019
  • A new development-led partnership in London, secured subject to planning, to deliver c.1,000 beds in 2021 supported through planning by King’s College, London

High-quality portfolio aligned to the strongest Universities where intake continues to grow

  • Operational portfolio increased to 50,000 beds valued at £4.6 billion; Unite share £2.4 billion, with a further 9,400 beds being developed (2016: 49,000 beds, valued at £4.3 billion; Unite share £2.1billion)
  • 85% of Unite’s portfolio now located at high and mid-ranked Universities (2016: 82%), increasing to 90% on completion of our development and University partnership pipeline and planned acquisitions and disposals

Strong financial position

  • LTV of 31% (2016: 34%), cost of debt reduced to 4.1% (2016: 4.2%)
  • Unite Group plc assigned an investment grade corporate rating of BBB from Standard & Poor’s and Baa2 from Moody’s
  • New £500 million unsecured debt facility will reduce average cost of debt to 3.9% when fully drawn

* The financial statements are prepared in accordance with International Financial Reporting Standards (IFRS). These financial highlights are based on the European Public Real Estate Association (EPRA) best practice recommendations and these performance measures are published as they are intended to help users in the comparability of these results across other listed real estate companies in Europe. The metrics are also used internally to measure and manage the business and to align to the performance related conditions for Directors’ remuneration. See glossary for definitions.

Read the complete Preliminary Results Statement


There will be a presentation for analysts this morning at 08.00 at the London Stock Exchange. A live webcast will be available at: To register for the event or to receive dial-in details, please contact

For further information, please contact:

Unite Students

Richard Smith / Joe Lister / Paul Richmond                                     

Tel: +44 117 302 7005


Justin Griffiths / Alison Watson / Mazar Masud                                           

Tel: +44 20 7250 1446