M&A drives rental income growth at LondonMetric, but profits fall

(Sharecast News) - Commercial real estate investment trust LondonMetric Property reported a double-digit increase in rental income during the fiscal year ended 31 March, helped by last year's acquisition of Urban Logistics REIT, though statutory profits dropped. LMP, which invests across the logistics, convenience, entertainment/leisure and healthcare sectors, said net rental income rose 16.6% to £455.3m, with underlying earnings up 13.9% at £305.3m.

However, reported profit was down 15% at £295.7m, mainly due to the costs of corporate acquisitions and debt repayments, along with lower property revaluation gains.

The company beefed up its portfolio during the year with £1.2bn of assets through M&A and £0.3bn through further acquisitions in the direct market, raising the portfolio value from £6.2bn to £7.6bn.

The purchase of Urban Logistics REIT increased the portfolio's weighting of logistics to 53% from 46%, helped by the £1.55bn of assets acquired during the year, 80% of which were in the sector.

LMP approved a fourth quarterly dividend payment of 3.3p, taking its total dividend for the year to 12.45p, up 3.8% over last year.

"Our results today reflect the progress that we have made over the last few years to create the UK's largest and most efficient NNN REIT. Despite macro uncertainty, our relentless focus on income and ongoing rental growth, has again delivered," said chief executive Andrew Jones.

"As owners of the business, our interests are fully aligned with our investors and we remain focused on our mission to operate, execute and allocate capital with discipline, experience and ruthless efficiency."

See the latest RNS on Investegate.