SCHRODER European Real Estate Investment Trust (Reit) said yesterday it had reinstated its quarterly dividend to its pre-Covid-19 levels because of an improving outlook, valuation resilience and a return to healthy rent collection during the six months to the end of March.
The group declared a quarterly dividend of 1.85 euro cents (R0.31) a share, with rent collection remaining strong at about 92 percent for the six months to the end of March and at 94 percent for the quarter to the end of March compared to 89 percent in the quarter to the end of December.
Schroder declared an interim dividend of 3.42 euro cents, and said it planned to declare two more special dividends of 4.75 euro cents in the next 12 months.
Schroder chairperson Sir Julian Berney said the portfolio valuation had remained resilient during the period, despite operating against a backdrop of local and national lockdowns, underpinned by uplifts across the industrial portfolio, a number of asset management successes, and improving and strong rent collection.
“As a result, we are pleased to be able to reinstate the dividend to the pre-pandemic level, while paying two special dividends to reflect the highly successful execution of the Paris sale and reward shareholders who continue to support the company,” Berney said.
Schroder’s share price climbed 3.34 percent to close at R20.45 on the JSE yesterday.
Berney said the board remained frustrated that the share price had not reflected the robust performance of the business during the pandemic or that the current discount properly reflected its future prospects.
“Given the healthy cash position, the board will continue to review the discount and use its discretion to execute measures that it believes should support income and total returns, including new acquisitions,” he said.
The group reported a net asset value of €197.1 million (about R3.34 billion), up from €182.1m compared to last year, and was down from the €201.8m reported at the end of September, primarily driven by the write down of the group’s Seville exposure to nil, which, in part, was offset by an increase in the valuation of the industrial and DIY portions of the portfolio.
It reported a loss of €0.7m, down from a profit of €4.9m reported a year earlier. Basic and diluted earnings per share amounted to a loss of 0.6 euro cents a share, down from a profit of 3.7 euro cents reported last year.
Looking ahead, Jeff O’Dwyer, a fund manager for Schroder Real Estate Investment Management, said although uncertainty relating to the pandemic would continue, they were starting to see positive signs of growth over 2021 as lockdowns eased and consumer and investor confidence returned.
“The proceeds from the sale of Boulogne-Billancourt substantially strengthen the company’s balance sheet and provide significant operational and financial flexibility,” O’Dwyer said.
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