Empiric Student Property (ESP) H2 2024 earnings summary

Executive summary

• Transformation plan delivered strong results, with full occupancy for three consecutive years and record like-for-like rental growth of 9.3% driven by dynamic pricing and high-demand locations.

• Portfolio now concentrated in 23 cities, with 97% in prime or super prime markets and ongoing prudent management to optimize cluster strategy.

• Customer satisfaction and Net Promoter Score reached record highs, with 53% of eligible rebookers staying another year and NPS at +32.

• Strategic capital raise of GBP 56.1 million in Q4 2024 enabled new acquisitions and accelerated postgrad conversion program.

• Dividend paid and declared at 3.7p, up 6%, with a minimum 2025 target of 3.7p.

Financial highlights

• Revenue increased 5% year-over-year to GBP 84.2 million, with like-for-like rent growth of 9.3%.

• Gross margin improved to 70%, ahead of peers and in line with guidance.

• EPRA earnings per share rose 5% to 4.2 pence; dividend increased 6% to GBP 0.037 per share.

• EPRA NTA per share decreased 0.9% to 119.6 pence, mainly due to 2.5% dilution from equity placement.

• Administrative expenses rose 10% (6% excluding £0.5m non-recurring charge); finance costs up 12% (7% excluding £0.9m non-recurring charge).

Outlook and guidance

• Expecting occupancy rates of 97%+ and rental growth of around 5% for academic year 2025/2026.

• Gross margin anticipated to hold at 70% in 2025; costs to remain broadly in line with 2024.

• Minimum dividend target of GBP 0.037 for 2025, with commitment to progressive policy.

• Operational beds for AY25/26 projected at ~7,650.

• 2025 capital expenditure of £28m planned for refurbishments, fire safety, and green investments.