LONDON (Alliance News) - Sigma Capital Group PLC on Tuesday reported a significant increase in both interim profit and revenue following the launch of its real estate investment trust in 2017, PRS REIT PLC, that is wholly dedicated to investing in new family homes.
In the six months ended June, Sigma Capital's pretax profit increased to GBP4.2 million from GBP1.0 million.
Managed PRS activities contributed GBP1.9 million to profit and Sigma's self-funded PRS activities contributed GBP1.7 million.
The real estate developer's revenue increased to GBP4.8 million from GBP1.8 million. Managed PRS revenue accounts for GBP4.6 million of total revenue.
As a result, the company has updated its dividend policy now that its PRS activities are "sufficiently mature" to support dividend payments.
Sigma intends to propose the payment of a final dividend at the company's 2019 annual general meeting and begin a progressive dividend policy.
The company's net asset value per share at the end of the period was 49.8 pence, a 19% increase from the price at the end of the first half in 2017.
Sigma's first half profit and revenue exceeded 2017's full year profit and revenue. In 2017, the company posted a pretax profit of GBP4.1 million and revenue of GBP4.4 million.
The company said the launch of PRS REIT in May 2017 has "fundamentally transformed" its growth prospects.
The closed-ended real estate investment trust is expected to grow its total resource to GBP900 million.
Sigma believes Tuesday's interim results "mark another significant" stage for the company and it is "well placed" to continue its growth.
Chief Executive Officer Graham Barnet said: "The acceleration in the group's growth and earnings reflects the successful launch of the PRS REIT in May last year, which has transformed our business model.
"We believe that Sigma is well-placed for continuing growth, and expect profitability in the second half to overtake the first half, with 2019 showing even greater value creation over 2018.
"Demand for family housing for rent remains very strong against a background of structural undersupply and growing need. We are pleased to play our part in helping to meet this shortfall, and look forward to delivering the PRS REIT's target of thousands of high-quality new homes across the major regions of England."
Shares in Sigma Capital were up 3.4% Tuesday at 144.20 pence each.
Prs Reit (PRSR)