(Alliance News) - Secure Income REIT PLC on Thursday said it plans to bolster its payout in 2022 by around 15% after a strong year, helped by rising inflation which is set to boost rent and a lower loan to value ratio.
Secure Income shares were up 3.5% to 424.50 pence each in London on Thursday.
The Beckenham, England-based real estate investment trust's basic & diluted net asset value per share at December 31 was 422.7 pence, rising 12% from 377.0p a year before.
EPRA net tangible assets per share increased 12% to 424.1p at December 31 from 379.3p 12 months earlier.
Net loan to value ratio reduced to 33.8% from 36.4%.
The weighted average unexpired lease term increased by around 50% over 2021 to 30.0 years following the regearing of the Merlin leases. Merlin Entertainments Ltd is one of Secure Income's largest tenants, operating a suite of leisure "attractions" around the world.
Non-Executive Chair Martin Moore said: "Our rents have not only resumed their pre-pandemic path, but future income expectations are now higher due to rising inflation. Following the major regearing of our valuable Merlin leases to 55.5 years without break, the company's WAULT at 30 years is now the longest amongst the major UK REITs. Since the year end the refinancing of our Merlin debt at a lower loan to value and a lower cost is expected to help boost our targeted dividend by an estimated 15% by the summer."
Looking ahead, the company is targeting a dividend increase in July of around 15% year-on-year to 18.2 pence per share. In 2021, the company paid out 15.2p per share, down 3.2% from 15.7p in 2020.
"This is driven by the return of rents to their pre-Covid trajectories, together with targeted earnings enhancement arising from the Merlin facility refinancing and current expectations of high inflation which would translate into increased rents in the near term. This increase assumes no change to the portfolio or material change to tenant circumstances," the company said.
By Greg Roxburgh; gregroxburgh@alliancenews.com
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