NewRiver REIT ends year in line with analyst expectations

(Sharecast News) - NewRiver REIT said on Friday that full-year underlying funds from operations and EPRA net tangible assets per share were expected to be in line with analyst consensus, after a year in which it completed the integration of Capital & Regional and strengthened its balance sheet. The London-listed retail-focused property investor said the Capital & Regional assets had been fully integrated onto its platform during the first full year of ownership, with £6.2m of annual net cost synergies unlocked.

It said the acquisition increased NewRiver's London retail weighting to 43% of the portfolio.

Chief executive Allan Lockhart said the first full year of ownership had delivered against the strategic objectives of the transaction.

"Integration is complete, all of the identified synergies have been delivered and the enlarged portfolio has generated positive operational momentum and continued valuation growth," he said.

NewRiver said London retail long-term leasing transactions were completed at 12.8% above estimated rental value and 31.8% above previous passing rent, while London retail capital values increased 2.0% in the 2026 financial year.

Snozone also delivered another year of growth, with full-year EBITDA up 10% to £3.2m.

Across the portfolio, NewRiver completed 930,700 square feet of leasing during the year.

A total of 185 long-term transactions secured £9.1m of annual rent at 8.5% above estimated rental value and 37.3% above previous passing rent, with a weighted average lease expiry of 9.0 years.

Occupancy remained high at 95.0%, while tenant retention was 92.7%.

Consumer spending across the portfolio increased 2.3% in the fourth quarter to March, ahead of the 0.8% benchmark increase.

Grocery spending rose 7.2% and discount spending increased 9.8%, which NewRiver said reinforced the resilience of its essential, everyday retail focus.

Portfolio capital values increased 0.5% in the second half and 0.7% on a like-for-like basis for the full year, marking a third consecutive half-year period of valuation growth.

The company completed £110m of retail disposals in line with March 2025 book values, including second-half sales of The Marlowes in Hemel Hempstead, Sprucefield Retail Park in Lisburn and Cuckoo Bridge Retail Park in Dumfries.

Part of the disposal proceeds was used for a 10% share buyback, which NewRiver said was accretive to underlying funds from operations and net tangible assets on a per-share basis.

Following the Capital & Regional acquisition, disposals and the repositioning of the Capitol Centre in Cardiff, the portfolio was now 76% core shopping centres, 20% retail parks, 3% regeneration and 1% work-out assets.

NewRiver said its loan-to-value ratio had reduced to close to its medium-term guidance level of below 40%, while cash had increased to about £115m.

The group also agreed a new £240m unsecured facility in April, comprising a £120m term facility and a £120m revolving credit facility.

It said the term facility matures in April 2030, with potential extension to April 2033, at a margin of 190 basis points, while the revolving credit facility matures in April 2031, with potential extension to April 2033, at a margin of 175 basis points.

The term facility would refinance the secured £140m Mall Facility in January 2027, which was retained after the Capital & Regional acquisition because of its 3.5% coupon.

NewRiver said the delayed draw structure would save about £1.4m in the 2027 financial year compared with drawing the facility immediately.

The new revolving credit facility is £20m larger than the facility it replaced and carried a significantly lower margin.

"We have combined this with disciplined capital allocation, disposing of assets at book value, executing an accretive share buyback, and completing a refinancing that returns the Group to a fully unsecured debt structure with extended maturities," Lockhart said.

"Against a more volatile macro backdrop, NewRiver is well-positioned.

"The portfolio has been strengthened, and we have the platform, pipeline, and balance sheet to deliver growth."

NewRiver noted current analyst consensus for the year ended 31 March was underlying funds from operations of £37.2m, or 8.3p per share, and EPRA net tangible assets of 107p per share.

Full-year results are due to be announced in June.

At 0952 BST, shares in NewRiver REIT were up 0.53% at 75.4p.

Reporting by Josh White for Sharecast.com.

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