Half Year 2024 Derwent London PLC Earnings Call Transcript
Key Points
- Derwent London PLC (DWVYF) achieved a resolution to grant planning permission for the 50 Baker Street project, a joint venture with Lazari.
- The company reported the highest half-yearly rental growth since 2016, with GBP10.8 million of new rent agreed since the start of the year.
- EPRA vacancy rate reduced to 3.2%, significantly lower than the market vacancy rate of 8.3%.
- The company increased its interim dividend by 2% to 25p per share, continuing its track record of progressive dividend increases.
- Derwent London PLC (DWVYF) has a strong balance sheet and the ambition to buy, with undrawn facilities and unrestricted cash up to GBP566 million at the half year.
- EPRA NTA per share fell 2.7% to 3,044p, although the decline was smaller than last year.
- Total accounting return in H1 was almost flat at minus 1%, with income close to offsetting the valuation fall.
- The valuation of wholly owned properties declined by 1.7% over the six months.
- Future estimated CapEx is expected to be high, with GBP103 million of spend in H2 and GBP156 million forecast for 2025.
- The company faces a challenging planning backdrop and constrained development pipeline as far out as 2028.
Good morning. Welcome to Derwent London 2024 Half Year Results Presentation. As well as for me, you will hear from Damian,Nigel and Emily and then I shall wrap up with Q&A. But before we start results, I'm delighted to say that we achieved a resolution to grant planning permission on Tuesday for our next range of project at 50 Baker Street, which we had a joint venture with Lazari.
In turning to slide 2 and an overview of our performance. London's occupational market has continued to strengthen, and I'm pleased to say that the rental growth we achieved in H1 was the highest half yearly performance since 2016. Demand for high-quality, well-located space is deep and broad-based and supply is limited. We continue to deliver leasing success with GBP10.8 million of new rent agreed since the start of the year, nearing 10% above ERV, which includes GBP8.8 million in H1.
This takes our leasing activity over the last 18 months to over GBP40 million. We also have GBP3.4 million under offer. We're seeing good activity
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