Editing Sirius Real Estate: Update
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== Summary == | == Summary == | ||
* Sirius Real Estate, the FTSE 250 real estate investment company, has made eight material announcements since our last report | * Sirius Real Estate, the FTSE 250 real estate investment company, has made eight material announcements since our last report (on 12th April 2022). | ||
*For us, the key highlight of the announcements is that the company has performed exceptionally well in the six months ended 30th September 2022, growing funds from operations (FFO) by 47% over the period. | *For us, the key highlight of the announcements is that the company has performed exceptionally well in the six months ended 30th September 2022, growing funds from operations (FFO) by 47% over the period. | ||
*Accordingly, we have updated our forecasts, and estimate that the expected return of an investment in Sirius Real Estate over the next 12-months is 57%. In other words, an £100,000 investment in the company is expected to return £157,000 in 12-months time. | *Accordingly, we have updated our forecasts, and estimate that the expected return of an investment in Sirius Real Estate over the next 12-months is 57%. In other words, an £100,000 investment in the company is expected to return £157,000 in 12-months time. | ||
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Given the rising interest rates and the uncertainty that this and the many other factors affecting the German and UK property markets are causing at the moment, the company has prioritised improving its debt ratios and building up its cash reserves. Net LTV, which reduces the loan balance by free cash (excluding restricted cash balances) in its calculation, was 41.0% (FY2022: 41.6%) whilst interest cover at EBITDA level was 8.1x as at 30th September 2022 (FY2022: 7.3x). The group added that it's fully committed to continue reducing its net LTV to be well within 40% or below in the near term. | Given the rising interest rates and the uncertainty that this and the many other factors affecting the German and UK property markets are causing at the moment, the company has prioritised improving its debt ratios and building up its cash reserves. Net LTV, which reduces the loan balance by free cash (excluding restricted cash balances) in its calculation, was 41.0% (FY2022: 41.6%) whilst interest cover at EBITDA level was 8.1x as at 30th September 2022 (FY2022: 7.3x). The group added that it's fully committed to continue reducing its net LTV to be well within 40% or below in the near term. | ||
== Reaffirmed Investment Rating == | == Reaffirmed Investment Rating == | ||
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{| class="wikitable" | {| class="wikitable" | ||
|+How have | |+How have are forecasts changed? | ||
! | ! | ||
! colspan="3" |31 March 2023 | ! colspan="3" |31 March 2023 | ||
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|} | |} | ||
== Appendix == | |||
{| class="wikitable" | {| class="wikitable" | ||
|+Condensed consolidated income statement | |+Condensed consolidated income statement |