UK's Land Securities reports stable half-year EPRA earnings as overhead costs fell

Overview

• UK real estate REIT's half-year EPRA earnings and EPS stable year-on-year

• IFRS profit before tax rose sharply, supported by a valuation surplus

• Company raised £500 mln equity post-period to fund retail acquisitions, targeting income growth

Outlook

• Landsec expects FY27 EPRA EPS to be stable vs FY26

• Company sees FY28 EPRA EPS growing by a high-single-digit percentage

• Landsec expects FY30 EPRA EPS to reach about 62 pence, implying c. 5% CAGR over FY27-FY30

Result Drivers

• RENTAL GROWTH - Like-for-like net rental income rose 6.2%, driven by rental uplifts on relettings and renewals, and high occupancy in both office and retail portfolios

• COST REDUCTION - Overhead costs fell 9% year-on-year, contributing to stable earnings despite the impact of asset sales

• PORTFOLIO REPOSITIONING - Recent acquisitions of major retail assets and disposals of lower-growth assets are expected to enhance income growth and EPS

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 9 "strong buy" or "buy", 10 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the diversified reits peer group is "buy"

• Wall Street's median 12-month price target for Land Securities Group PLC is GBp715.00, about 2.7% above its November 12 closing price of GBp696.00

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 13 three months ago

Reuters Recommended Reads

• Nov 11 - UK's Taylor Wimpey warns on annual profit as affordability woes deepen

• Nov 12 - UK homebuilder Persimmon sees 2027 volume growth but flags cost pressures

• Nov 12 - UK house sales outlook is darkest since 2023, RICS says

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)