Half Year 2024 Unite Group PLC Earnings Call Transcript
Key Points
- UNITE Group PLC (UTGPF) reported record earnings and dividends for the first half of 2024, driven by strong lettings performance.
- The company achieved 4% growth in EPS, 5% growth in NTA per share, and an 8% total accounting return in the first half of 2024.
- A GBP450 million equity raise will support growth in the GBP1.5 billion development pipeline and accelerate earnings growth into high single digits over the next few years.
- Strong rental growth and occupancy rates for the '23-'24 academic year supported a 5% increase in the interim dividend to 12.4p.
- The company is making significant progress with university joint ventures, including a new partnership with Newcastle University and another potential partnership in the pipeline.
- Applications to UK universities are down by 1.7%, equating to about 10,000 fewer applications, which could impact future occupancy rates.
- Utility costs rose by 15% due to higher commodity prices, impacting overall cost management.
- The company incurred GBP3.5 million in costs for its technology replatforming program, with further costs expected over the next 2.5 years.
- Political and policy uncertainty in the higher education space has characterized the first half of the year, adding a layer of risk to future planning.
- The forward funding market is not operating for many trader developers, making development unviable in about half the markets due to build cost inflation.
Greats. Good morning, everybody, and welcome to our results announcement this morning. Welcome to you all in the room and those joining us remotely. As you will have seen, we've been fairly busy over the last few days and we're excited to be able to talk to you today about the progress that we're making and the plans that we've got. And for those of you who have participated, thank you very much for your ongoing support.
We feel blessed to be operating in a sector which is being supported by structural tailwinds and to have made real progress in locking down an opportunity set that this capital will allow us to keep pushing to unlock and also for us to then go forward and to secure further opportunities from our emerging pipeline. We will, of course, remain disciplined with our capital and continue to rotate out of those assets where we see lower-growth opportunities, and also using debt appropriately within our net debt-to-EBITDA targets. So we'll run through the results and touch on the placing as well this morning, so
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