Stenprop interim results September 2016
Net rental income lowered to EUR18.942 million (2015: EUR19.625 million), profit from operations plunged to EUR1.521 million (2015: EUR34.137 million), loss attributable to equity holders of the company came in at EUR5.535 million (2015: profit of EUR27.254 million), while headline earnings per share grew to EUR5.80 cents per share (2015: EUR4.89 cents per share).
On 23 November 2016, the directors declared a dividend of EUR4.5 cents per share payable on 20 January 2017, relating to the six months to 30 September 2016. This interim dividend will be a cash dividend and reflects the directors' intention to maintain the historic payout ratio of at least 85% of diluted adjusted EPRA EPS.
In the Integrated Annual Report published on 10 August 2016, guidance was given on the impact on EPRA earnings per share of the weakening of Sterling against the Euro. The Report commented that at an average exchange rate for the year of EUR1.20:GBP1, the forecast adjusted annual EPRA EPS for 2017 would drop from 10.58 cents to 10.29 cents per share. At an average exchange rate for the year of EUR1.15:GBP1, the number would drop further to 10.15 cents per share.
Stenprop's guidance for adjusted annual EPRA EPS for the full year ended 31 March 2017, in country currencies, remains unchanged. With average exchange rates for the first half of the year established, Stenprop is now able to provide guidance on the impact of exchange rate fluctuations in the second half of the year.
At an average exchange rate of EUR1.15:GBP1 for H2, giving an average exchange rate for the full year of EUR1.19:GBP1, Stenprop expects to deliver an adjusted EPRA EPS of 10.26 cents. At an average exchange rate of EUR1.10:GBP1 for H2, giving an average exchange rate for the full year of EUR1.16:GBP1, adjusted EPRA EPS drops to 10.18 cents. At an average exchange rate of EUR1.20:GBP1 for H2, giving an average exchange rate for the full year of EUR1.21:GBP1, adjusted EPRA EPS rises to 10.34 cents.
Based on an expected EPRA EPS of 10.26, Stenprop expects to declare a final dividend in June 2017 of 4.5 cents, giving a full year dividend of 9.00 cents a share. This represents a 1% increase on the full dividend of 8.9 cents for the prior year, and increases the pay-out ratio slightly to 87.7% compared with the historic pay-out ratio of 85%.
Given the nature of its business, Stenprop has adopted distribution per share as its key performance measure, as this is considered more relevant than earnings or headline earnings per share.