Derwent London (DLN) Q1 2025 TU earnings summary

Executive summary

• Central London office market remains robust with strong demand and low supply, driving rental growth and investment volumes doubling year-over-year to £2.4bn in Q1.

• £14.3m of leasing and asset management transactions completed or under offer since the start of the year, with active discussions ongoing.

• Major developments progressing, including 25 Baker Street W1 (pre-let at rents above ERV) and Network W1, with significant pre-letting and residential sales exceeding appraisal values.

Financial highlights

• Net debt decreased slightly to £1.47bn from £1.48bn at 31 December 2024.

• EPRA LTV ratio reduced to 29.6% at Q1, supported by retained earnings and asset disposals.

• Interest cover for Q1 was 3.5x; cash and undrawn facilities totaled £615m at quarter-end.

• Weighted average interest rate at Q1 was 3.43% (cash basis) and 3.54% (IFRS basis).

• Final dividend of 55.5p per share (£62m), well-covered by EPRA earnings, to be paid 30 May 2025.

Outlook and guidance

• 2025 portfolio ERV guidance reiterated at 3-6% growth.

• Continued focus on earnings, regeneration, and recycling to support positive total return outlook.

• Further asset disposals expected in 2025 to fund development pipeline and acquisitions.