NewRiver REIT underperforms benchmark as integrates Capital & Regional

(Alliance News) - NewRiver REIT PLC on Tuesday announced a lower annual dividend, as the real estate investment trust underperformed against its benchmark.

The London-based developer and manager of retail properties said net asset value fell 11% to 103 pence per share as at March 31 from 116p a year before.

NAV total return for the company's portfolio in the financial year that ended March 31 was 7.8%, underperforming against the MSCI All Retail benchmark, which showed a return of 9.4%.

NewRiver declared a final dividend of 3.5p per share, up 9.4% from 3.2p a year prior. This lowers the total dividend by 1.5% to 6.5p from 6.6p in financial 2024. However, dividend cover improved to 125% from 118%.

Looking ahead, the company said the benefits of its merger with Capital & Regional transaction are starting to flow through, with further benefits expected in financial years 2026 and 2027, as it "fully unlocks" cost synergies.

NewRiver bought Capital & Regional, an investor in community shopping centres, for GBP147 million, completing the takeover in December.

Separately, NewRiver on Tuesday announced the disposal of Abbey Centre, Newtownabbey in Northern Ireland to the Herbert Group of Companies for GBP58.8 million.

"This off market sale of Newtownabbey is a great example of our specialist platform capabilities, from our disciplined stock selection to transforming the asset into one of the most successful shopping centres in the region and then securing a successful exit at book value. Capital recycling is one of our growth drivers and we believe the success of our asset management initiatives has extracted the maximum value from this asset," said NewRiver Chief Executive Allan Lockhart.

"We remain on track with other disposals and so whilst this sale brings our loan to value to below our guidance, in due course we expect to recycle our capital into opportunities with superior income and capital growth potential. This sale also demonstrates the continuing improvement in investor demand for UK shopping centres."

NewRiver shares were down 1.6% to 78.40 pence each on Tuesday morning in London, giving it a market capitalisation of GBP372.8 million.

By Tom Budszus, Alliance News slot editor

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