Life Science Reit (LABS) H2 2024 earnings summary

Executive summary

• Strong like-for-like (LFL) estimated rental value (ERV) growth of 8.6% for FY24, with lab space outperforming at 13.7% ERV growth.

• Portfolio valuation increased to £385.2m (FY23: £382.3m), with valuation declines moderating in H2 2024.

• Net rental income rose 4.3% year-over-year to £14.4m, but adjusted earnings fell to £5.9m due to higher finance costs.

• NTA per share declined 6.9% to 74.4p, reflecting revaluation losses.

• Rent collection remained robust at 99.8%, with contracted rent increasing to £16.5m.

Financial highlights

• Adjusted earnings for FY24 were £5.9m (FY23: £6.7m), with adjusted EPS at 1.7p (down from 1.9p).

• Net rental income increased to £14.4m (FY23: £13.8m).

• Portfolio valuation rose by £2.9m to £385.2m, despite a 4.0% LFL valuation decline.

• Net borrowings increased by £22.7m to £117.1m, with LTV rising to 30.4%.

• Dividend per share was 1.0p (FY23: 2.0p).

Outlook and guidance

• Market conditions are stabilizing, with investment yields and demand showing signs of recovery in the Golden Triangle and London.

• Significant rental upside remains, with an 84% potential income uplift identified through lease-up and development pipeline.

• Future dividends are suspended until the ongoing Strategic Review concludes.