LondonMetric Property Plc

Reported figures included net rental income of GBP 455.3 million, up 16.6%; EPRA earnings of GBP 305.3 million, up 13.9%; and EPS of 13.45p, up 2.4%. The year also delivered portfolio valuation gains of GBP 68 million, IFRS profits of GBP 295.7 million, EPRA NTA of 200.6p per share, and total accounting return of 6.9% (7.7% excluding exceptional items). Full-year dividend was 12.45p per share, up 3.8%, and Q1 FY27 dividend was set at 3.15p, up 3.3%. Guidance/commentary pointed to contracted rent roll of GBP 432.1 million and more than GBP 38 million of short-term reversion by 2028, plus GBP 11 million of additional rent from vacant assets, taking rent roll to above GBP 480 million. Management said finance costs should not increase materially over the next 2 years, and annualized debt savings were about GBP 10 million.

Andrew Jones framed the business as a “true triple net income compounding model,” emphasizing predictable rent, low leakage, and disciplined capital allocation. He repeatedly stressed that income is the key value driver in a volatile valuation environment, and said the company wants to keep “running winners and selling losers” rather than chasing AUM growth. His tone was confident and expansive, particularly on acquisition opportunities, asset recycling, and the benefits of scale.

Martin McGann focused on the financial engine of the business: net rental income of GBP 455.3 million, administrative overhead of GBP 30.2 million, EPRA cost ratio of 7.7%, and net finance costs of GBP 124 million versus GBP 97 million last year. He highlighted strong collections at 99.7%, gross-to-net leakage of 1.4%, and strong cash support for the dividend with 108% cover and full cash cover. On capital structure, he said gross debt is almost GBP 3 billion, cash is GBP 143 million, LTV is 36.7%, net debt-to-EBITDA is 7.5x, interest cover is 3.8x, and debt is 99.8% hedged; he also noted GBP 1.2 billion of new debt facilities, a GBP 500 million A- bond at 4.69%, and a GBP 150 million U.S. private placement.

Analysts probed whether aggressive rent increases could hurt tenant retention, and management said the risk varies by geography, with London viewed as softer, but they are not yet seeing a vacancy problem. Questions on leverage focused on net debt-to-EBITDA, where Martin said he would prefer a “6x in front of it” and expects disposals to bring gearing down, while ruling out concern as long as LTV stays well below 40%. Analysts also asked about acquisition scaling and returns across the four acquisition buckets; management said opportunity is the main constraint, and gave indicative returns such as about 5.5% for sale-and-leasebacks, lower returns for pension-fund assets with very long leases, and development funding spreads of 50 to 5 basis points over the finished investment yield.