SUPERMARKET INCOME REIT PLC – INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2018

SUPERMARKET INCOME REIT PLC – INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2018

Supermarket Income REIT plc (LSE: SUPR), the only real estate investment company dedicated to investing in supermarket property in the UK, is today reporting its interim results for the Group for the six months ended 31 December 2018 (the “Period”).

 Highlights for the Period:

  • Acquired sixth supermarket, a Morrisons store in Sheffield, for £51.7 million (net of acquisition costs), reflecting a net initial yield of 4.9%
  • Portfolio of six investment properties benefiting from highly attractive leases:
    • Strong tenant covenants (Tesco, Sainsbury’s and Morrisons)
    • Current weighted average unexpired lease terms of 19 years (no break options)
    • Contracted rental growth through upward only RPI-linked rent reviews
    • Annualised passing rent roll of £16.5 million
    • Two rent reviews completed in the Period with an average increase of 3.2% achieved
  • Portfolio independently valued at £320.6 million as at 31 December 2018, representing a like-for-like increase of 1.3%[1] for the six-month period and reflecting an aggregated net initial yield of 4.9%
  • IFRS Earnings per share of 3.0 pence, EPRA Earnings per share of 2.5 pence
  • Quarterly dividend increased by 3.2% from 1.375 pence per share to 1.419 pence per share in line with RPI inflation
  • Dividends declared in the Period of 2.8 pence per share, on track to deliver full-year target of 5.63 pence per share and 5.68 pence per share for the next twelve months[2]
  • Agreed a new £52 million debt facility with Bayerische Landesbank, with a fixed all in interest cost of 2.6% for the five-year term of the facility
  • Net loan to value (“LTV”) ratio of 43.0% as at 31 December 2018, with a current cost of debt of 2.5%
  • Net Asset Value (“NAV”) per ordinary share of 96 pence as at 31 December 2018

Nick Hewson, Chairman of Supermarket Income REIT plc, commented:

“We have continued to build our portfolio of supermarket property, with the acquisition of the Morrisons store further increasing the diversification of the portfolio by store location and operator covenant.

Our inflation linked rents have allowed us to increase the quarterly dividend from 1.375 pence per share to 1.419 pence per share, in line with RPI inflation, with the Company being on track to deliver an annualised dividend of 5.63 pence per ordinary share for the 2018/19 financial year and 5.68 pence per share for the twelve months ending 31st December 2019.

The Company continues to offer robust and growing returns through its investment in long-let food stores which have proved to be operationally and financially resilient despite the uncertainty caused by the ongoing Brexit process and the structural headwinds facing non-food and high street retailers. Using our specialist knowledge of the sector our Portfolio continues to provide attractive inflation linked income for shareholders.”

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