Segro shares were higher on Friday after pre-tax rose 8% to £386m in 2022 as the logistics property firm said net rental income rose 18.9% to £522m.
The company suffered a 15% reduction in adjusted NAV per share due to a negative revaluation of their property portfolio. Macroeconomic influences were to blame for lower property prices but strong rental demand supported earnings.
Segro noted record new headline rent commitments of £98m as customers snapped up their warehouses.
Segro shares were 4% higher at the time of writing on Friday.
“Logistics property specialist SEGRO has reported underlying profits up 9% to £386m, with strong demand from occupiers contributing to a 19% increase in rental income,” said Steve Clayton, Head of Equity Funds at Hargreaves Lansdown.
“But rising interest rates are impacting on what the group’s properties are worth in the open market. The Net Asset Value dropped 15% as a result. SEGRO are far from alone in seeing their asset values drop. So far, the group is paying more attention to its operational performance, which gave SEGRO the confidence to hike the dividend by 8.2% to 26.3p per share. The market was expecting something along these lines and the shares are little changed in early trading.”