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(Alliance News) - Unite Group PLC shares rose on Wednesday after the student accommodation provider said it swung to a profit in 2021 and raised its shareholder payout on a "strong" recovery from the pandemic.
Shares were up 5.6% at 1,046.00 pence each on Wednesday morning in London.
In 2021, Bristol-based Unite swung to a pretax profit of GBP343.1 million from a loss of GBP120.1 million in 2020.
This was on total revenue growth of 24% to GBP266.9 million from GBP215.6 million. Rental income rose to GBP209.0 million from GBP196.1 million.
Its occupancy increased to 94% for the 2021-2022 academic year from 88% the year before and it experienced a lower impact from rental discounts compared to 2020.
Unite noted that its profit growth also reflected the valuation growth of its property portfolio.
Unite's property portfolio valuation as of December 31 increased 2.1% year-on-year to GBP5.29 billion from GBP5.18 billion.
The company proposed a final dividend of 15.6 pence per share, reflecting a 22% increase from the final payout of 12.75p the year prior. Its total dividends for 2021 amounted to 22.1p, up 73% from 12.75p.
Looking ahead, Unite said its outlook remains "strong", stating that it is confident in its ability to deliver "significant" growth in earnings and attractive total accounting returns for shareholders.
The company expects robust demand for the 2022-2023 academic year, with reduced disruption from travel restrictions.
Unite said it is confident that this will support a return to 97% occupancy and 3% to 3.5% rental growth.
"The business has seen a strong recovery in performance in 2021 and is well-positioned for further growth due to our alignment to the strongest universities, an enhanced reputation thanks to our supportive actions during the pandemic and our best-in-class operating platform," Chief Executive Richard Smith said.
"The outlook for the business and the UK Higher Education sector is strong, driven by rising participation rates, increased demand for our product from returning students, significant and sustained demographic growth and government support for growth in international student numbers."
By Abby Amoakuh; abbyamoakuh@alliancenews.com
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