Tritax hints at logistics Brexit 'silver lining' as results continue to impress

By Paul Norman - Wednesday, March 07, 2018 8:22

Tritax has reported strong capital growth rises in full year results that emphasis the robust nature of the UK logistics market where the company's business is squarely focused.

NAV lifted 10.3% to 142p with outperformance driven by market yield compression.

EPRA EPS fell 2% to 6.4p principally driven by hit by the £350m equity placing competed in May.

Tritax posted an 8.7% LFL portfolio revaluation gain and a 10.3% revaluation gain on recent acquisitions.

Acquisitions drove a 26% increase in contracted rent through FY17 with an increase in portfolio reversion to 7.4%. 

The EPRA cost ratio is at 13.1% (vs. 15.8% in FY16). The portfolio remains fully let (or pre-let) at 100%, with a weighted average unexpired lease length of 13.9 years.

Tritax completed £497.5m of acquisitions in  the year.

Richard Jewson, chairman of Tritax Big Box REIT, said: “We have a sector-leading portfolio of UK Big Box assets that are benefiting from structural change driven by increasing e-commerce penetration, and the operational and financial benefits which they can provide to our Customers. The fundamentals of our market remain positive and are largely unaffected by current geopolitical and economic uncertainties. Despite the uncertainties it brings, Brexit may provide a silver lining, since with increased border controls our Customers will require more warehousing domestically, further supporting our business case.

"Through the Manager’s excellent relationships, we see opportunities to acquire high-quality assets and forward-funded developments to further diversify our portfolio. The continued imbalance between occupational supply and demand means that we expect rental growth and values to remain robust in 2018. The assets we acquired towards the end of 2017 will add to our rental income in 2018. Coupled with our largely fixed cost base, this will contribute to earnings growth and support our progressive dividend target of 6.70p for 2018.”


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