Shares in property company Grainger edged up in early trading today after the firm said it had produced a “strong performance” in the first half of its financial year, with a 23 per cent rise in profits.
The FTSE 250-listed company said that its net rental income had increased nine per cent to £21.8m, up from £20m a year earlier.
The company’s adjusted earnings were up 20 per cent to £40.9m, while its pre-tax profit increased 23 per cent to £50.6m.
The company said its interim dividend per share was up nine per cent to 1.74p.
Meanwhile, the property group said that it had secured £756m of private rented sector (PRS) investments, edging it towards its initial £850m target.
Why it’s interesting
Grainger has been at the forefront of the private rented sector (PRS), a model which is becoming increasingly common in the UK.
Although 98 per cent of UK landlords own less than 10 properties, Grainger says that Londoners in particular are becoming more responsive to a higher level of customer care that only a large private company can provide.
Analysts agree. Tim Leckie, executive director of equity research, listed property at JP Morgan said: “Political support for the sector continues to gather momentum and demand for renting is likely to accelerate as the PRS market matures.”
Analysts from Numis say the company has shown a “a robust performance” and demonstrates that “decisive actions taken by management over the past couple of years is feeding through to a much improved financial performance”.
What Grainger said:
Helen Gordon, chief executive of Grainger said:
“I am pleased to report another period of strong performance. We continue to lead the private rented sector, a sector undergoing structural growth, and we are well positioned for the future.
“We are a business on a strong growth trajectory and the opportunity in the UK PRS market is vast. We are uniquely placed given our market leading position and our in-house capability to originate, invest and operate homes for rent.”