Grainger (GRI) H1 2025 earnings summary

Executive summary

• Delivered strong half-year results with 15% net rental income growth and 23% EPRA Earnings increase, supported by high occupancy, robust operational platform, and portfolio expansion.

• Achieved record earnings growth, high customer retention, and a resilient business model in a structurally supported sector.

• Interim dividend increased 12% to 2.85p per share, maintaining a progressive dividend policy.

• IFRS profit before tax was £74.0m, reversing a £31.2m loss in HY24, and diluted EPS reached 7.5p.

• Preparing for REIT conversion in early September, expected to generate £15m annual tax savings and support a progressive dividend policy.

Financial highlights

• Net rental income reached £61.3m, up 15% year-over-year, driven by portfolio expansion and 4.4% like-for-like rental growth.

• EPRA Earnings were £30.2m, up 23% year-over-year; adjusted earnings up 13% to £50.1m.

• Dividend per share grew 12% to 2.85p; EPRA NTA per share up 1% to 300p.

• Portfolio valuation increased 0.8% in the period; BTR portfolio valuation up 1%.

• Operational cash flows exceeded £200m annually; net debt at £1,475m, LTV at 38.5%.

Outlook and guidance

• On track to deliver 25% EPRA Earnings growth by FY2026 and 50% by FY2029 from committed pipeline, with FY26 guidance of £60m.

• Net rents expected to rise to £153m in FY2024 and £193m with full pipeline delivery.

• Medium-term sustainable total return target of at least 8%, with recurring earnings yield of 3.5% and 4.5% capital growth.

• Dividend policy to shift post-REIT to at least 80% of EPRA Earnings distributed.

• LTV forecast to reduce over time, with no material refinancing required until 2029.