Shaftesbury PLC

For 2025, like-for-like valuation increased 6.6% to GBP 5.4 billion, led by 6% ERV growth and a 2 basis point inward yield move. Gross rents were up 5.9% like-for-like to GBP 195.6 million, lettings and renewals ran 10% ahead of ERV and 14% above previous passing rents, and underlying earnings rose 12% to GBP 81.9 million, or 4.5p per share. The board proposed a final dividend of 2.1p per share, taking the full-year dividend to 4p per share, up 14%. Net debt fell to GBP 0.8 billion on a group share basis from GBP 1.4 billion, with LTV at 17%, and finance costs were reduced by almost 30% to GBP 41.4 million. Looking ahead, management targets rental growth of 5% to 7%, total property return of 7% to 9%, and total accounting return of 8% to 10%; it also said cash rents should grow in line with ERV, admin cash costs should come down further over the next two years, and finance costs should be broadly flat overall despite refinancing GBP 400 million of debt.

Ian Hawksworth emphasized that the West End portfolio is “impossible to replicate” and said the business is benefiting from active leasing, low vacancy, strong footfall, and customer sales growth. He highlighted the Norges Bank partnership on Covent Garden as evidence of the portfolio’s quality and said the company is well positioned to invest and expand when opportunities arise. His tone was confident and upbeat, while acknowledging broader macro and geopolitical challenges.

Situl Jobanputra focused on the financial lift from higher rental income, stronger earnings, and lower funding costs. He noted gross rents of GBP 195.6 million, underlying earnings of GBP 81.9 million, finance costs of GBP 41.4 million, net debt reduction to GBP 0.8 billion, and LTV of 17%, while also flagging that administration costs of GBP 41 million included a higher share option charge that was up by nearly GBP 5 million year over year. He said the company plans further reductions in absolute cash costs over the next two years, expects finance costs to be broadly flat, and has extended and repriced debt facilities, including a new GBP 300 million five-year loan for Covent Garden and GBP 450 million of other undrawn facilities extended to 2029 and 2030.

Analysts asked whether Carnaby Street’s strong ERV growth can keep running as it catches up with the rest of the portfolio, and management said the newer brands are trading at significantly higher sales densities, supporting medium- to long-term rental growth. Questions also focused on leverage and acquisition firepower; management said it is intentionally keeping leverage low, has plenty of room and liquidity to deploy capital accretively, and sees opportunities across its estates, including through the partnership with Norges Bank. On 2026 earnings, management declined to comment on consensus directly but pointed to the main building blocks: 5% to 7% ERV growth, improving property-level net-to-gross, lower cash admin costs, and finance costs targeted to be flat overall.