Life Science Reit (LABS) H1 2025 earnings summary

Executive summary

• Strategic Review concluded with a decision to pursue a Managed Wind-Down to maximize shareholder value, aiming for asset realization over 12–18 months, subject to shareholder approval.

• Challenging macroeconomic conditions and sector-specific headwinds slowed leasing activity, though new leases were signed at attractive rates, increasing life science tenant exposure.

• Portfolio value declined due to outward yield shift and market uncertainty, with a focus on orderly asset disposals and capital returns.

Financial highlights

• Gross property income rose 9.9% year-over-year to £8.9m, driven by new and full-period leases.

• Adjusted earnings stable at £3.4m, with higher rental income offset by increased finance costs (£2.6m vs £1.7m prior year).

• IFRS loss before tax widened to £29.7m (vs £13.0m prior year), mainly due to £31.6m fair value loss on investment properties.

• EPRA NTA fell to £232.1m or 66.3p per share (from £260.4m or 74.4p per share at year-end 2024).

• Portfolio valuation decreased 6.7% like-for-like to £360.6m, reflecting a 49–50bps outward yield shift.

Outlook and guidance

• Managed Wind-Down process to be implemented, with asset sales expected over 12–18 months, method and timing dependent on market conditions.

• Directors note material uncertainty regarding going concern due to ongoing covenant breaches and liquidity risks, mitigated by supportive lenders and planned asset disposals.