Land Securities Group PLC ("Landsec") today announces its results for the year ended 31 March 2025.
Financial highlights
• EPRA earnings up £3m to £374m, as strong 5.0% LFL net rental income growth and lower overhead costs more than offset impact from significant disposals early in year and a rise in finance costs
• EPRA EPS up 0.4% to 50.3p, in line with expectations and ahead of initial guidance
• Total dividend up 2.0% to 40.4p per share, in line with guidance
• Profit before tax up to £393m, as strong 4.2% ERV growth supported £119m or 1.1% uplift in portfolio value, resulting in 6.4% return on equity and 1.7% increase in EPRA NTA per share
• Group LTV of 38.4% and average net debt/EBITDA of 7.7x pro-forma for disposals since year-end, as long 9.6-year average debt maturity underpins resilience of capital base
Operational highlights
• Delivered 5.0% LFL net rental income growth, ahead of guidance, with 8% rental uplifts on relettings / renewals in London and major retail, and continued strong leasing momentum since the year-end
• Increased occupancy by 100bps on a LFL basis to 97.2%, the highest level in five years
• Drove 4.2% ERV growth through successful leasing activity, adding to future income growth potential
• Reduced overhead costs by 5%, with more than 10% further savings expected over FY26-27
Central London income growth increases, as investment market activity starts to pick up
• Delivered 6.6% LFL net rental income growth, with occupancy up 120bps to 98.0%, £24m of lettings signed or in solicitors hands 7% above ERV, and relettings/renewals 13% above previous rent
• Drove 5.2% ERV growth, as customer demand remains focused on high-quality space in best locations, with growth for current year expected to be at broadly similar levels
• Reversionary potential increased to 12%, paving way for further near-term LFL income growth
• Portfolio valuation up 1.0%, as yields start to stabilise and investment market activity continues to pick up steadily, supporting planned release of £2bn of capital employed from FY27 onwards
• Set to complete £860m of developments in late FY26 at accretive 7.1% gross yield on cost, with encouraging customer interest expected to translate into first pre-letting activity in second half
Major Retail income up stronglyas brands focus on best destinations
• Delivered 5.1% LFL net rental income growth, with occupancy up 110bps to 96.6%, £39m of lettings signed or in solicitors hands 11% above ERV, and relettings/renewals 8% above previous rent
• Drove 4.0% ERV growth, capitalising on continued focus from brands on fewer, bigger, better stores, with similar growth expected for current year
• Expect continued LFL income growth, as leasing pipeline remains strong and rental uplifts grow
• Portfolio valuation up 3.4%, reflecting attraction of high-quality, growing income
• Invested £610m in Liverpool ONE and Bluewater acquisitions at average 7.7% income return, with aim to invest a further £1bn in highly accretive growth of major retail platform over next 1-3 years
Progressed preparation of sizeable residential pipeline, ahead of first potential starts in late 2026
• Started on site with infrastructure works, secured vacant possession and completed demolition for first phase of consented 1,800-homes Finchley Road scheme in Zone 2, London
• Renegotiated development agreement at Mayfield, Manchester, unlocking option to deliver c. 1,700 homes from 2026 onwards, with decision on detailed planning for first phase expected in second half
• Submitted outline/detailed planning application for masterplan in Lewisham, Zones 2&3, London, covering up to 2,800 homes, with planning decision expected in second half of year
• Preparing for first potential residential development starts in late 2026, as part of strategic objective to invest £2bn+ in this structural growth sector by FY30
Maintained strong capital base, with £655m of capital recycling broadly in line with book value
• Sold £496m of non-core assets during year plus a further £159m since year-end, on average 1% <mark style="background-color:yellow">below</mark> Mar-24 book value, with further non-core disposals expected in near term
• Maintained solid capital base, with 9.6-year average debt maturity, £1.1bn cash and undrawn facilities, and pro-forma for disposals post year-end, 7.7x average net debt/EBITDA and 38.4% LTV
• Capitalised on sector-leading access to credit during year, with £350m 10-year bond issue at 4.625% coupon and refinancing of £2.25bn revolving credit facilities at existing low margins