(Alliance News) - Empiric Student Property PLC sunk to a loss in 2020, it reported Wednesday, as the pandemic resulted in students studying at home but feels it is primed for growth in 2021 as universities re-open for the 2021-22 academic year.
For 2020, owner and operator of student accommodation across the UK succumbed to a pretax loss of GBP24.0 million compared to a GBP54.8 million profit in 2019.
Revenue fell 16% to GBP59.4 million from GBP70.9 million as net rental income dropped 23% to GBP36.8 million from GBP47.6 million.
Property costs were GBP22.7 million, down 3% both in total and on a per bed basis from the year before, as the company cut discretionary costs and delayed expenditure.
Chief Executive Duncan Garrood said: "As we entered 2020, we were making good progress against our medium-term objectives, creating an in-house operating platform, growing revenue, reducing costs, and increasing our operating margin and dividend cover. The pandemic clearly brought challenges, but we reacted quickly to support our customers and brand reputation."
Empiric noted GBP6.5 million of refunds were provided to students for the period from April to September 2020, as it released students from their obligations on a case-by-case basis.
The company said this "helps protect its brand".
As a result, it said expected summer lets in 2020 of around GBP700,000 were lost due to the pandemic.
At the start of the 2020-21 academic year, it reported revenue occupancy rates of 70%, compared to 94% in 2019-20.
"This meant that the final four months of the 2020 financial year had significantly reduced occupancy compared to 2019," Empiric explained.
However, at this point, for the current academic year 2020-21 like for like rental growth is 1.8%.
Empiric's EPRA net tangible asset end 2020 at 105.00 pence each, down from 110.21p at the same point the year before.
Garrood added: "The group has remained resilient and is well placed to benefit from opportunities when the market recovers, and our underlying business outlook is positive with customer demand set to grow.
"Our Hello Student brand proposition, especially in a Covid-19 affected world, gives us a competitive advantage with predominately self-contained studio apartments, and a friendly supportive service focused on student well-being. There is still more to be done to maximise the benefits of our operating model and we remain intensely focused on delivering further value for all our stakeholders."
Empiric noted its dividend payouts remain suspended but recognises the importance of shareholder returns and will seek to resume dividends at an "appropriate level as soon as there is sufficient clarity of outlook."
Shares in Empiric Student Property were 1.1% lower in London on Wednesday at 77.05 pence each.
By Paul McGowan; paulmcgowan@alliancenews.com
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Empiric (ESP)