Tritax Big Box REIT plc

Good afternoon and welcome to our results presentation for the six months ended 30th of June. I'll shortly hand you over to our CEO, Colin Godfrey, but before I do, a couple of points to note. After the presentation, there will be an opportunity for investors and analysts to ask questions. You can submit your question in the webcast viewer and in the interest of time, we will aggregate similar questions. As a reminder, we are in an offer period, so we are restricted in answering questions relating to our offer for Warehouse REIT. Thank you very much.

Hello and welcome to our results presentation for the first six months of 2025. I'm Colin Godfrey, CEO of Tritax Big Box. As usual, I'll kick off with our key messages before handing over to Frankie, our CFO, to give an update on our financial and operational performance during the first half. I'll then outline the significant strategic progress that we've made in the period. And finally, we'll open up the lines for Q&A. As outlined at our Capital Markets Day in June, the key message I want to deliver today is that as well as driving strong operational performance, we have embedded very significant potential within our business, with the ability to deliver earnings growth of 50% by the end of 2030. And this will drive exceptional shareholder value, including superior risk-adjusted returns from our logistics and data center developments. And as we outline here, we are making excellent strategic progress. We're delivering strong performance with attractive growth across all of our key financial KPIs. Our strategic execution is progressing well, with the UK CM Logistics assets now fully integrated and performing well, and the non-core disposal programme fully on track. We've also secured a second data centre opportunity and successfully refinanced two DEP facilities. And we have three powerful growth drivers that are delivering today and with the potential to deliver even more in the future. Record rental reversion supported by ongoing URV growth as a result of being positioned in the right sub-markets. An attractive logistics development pipeline that can capture the substantial and enduring demand for new buildings. And exceptional returns through data centre developments. Now it's important to stress that we carefully mitigate the risk across all our development activities by deploying our capital with pinpoint precision and taking advantage of the flexibility that we've deliberately built into our pipeline. Now, I'll touch upon all of this in a moment, but for now, I'll hand you over to Frankie to explain the detail behind our strong performance in the period.

Frankie. Thank you, Colin. And hello, everyone. Turning to the key financial highlights, as Colin says, we've delivered another period of strong performance. We've generated attractive levels of growth in adjusted EPS of 6.4%, and this has supported our growth in dividend per share of 4.9% for the period. Our property valuation performance has led to growth in APRA NTA per share of 1.4%, to 188.2 pence, and a total accounting return for the six months of 3.6%, which is ahead of this time last year. This is enhanced, however, when excluding certain non-recurring items, which I will set out on a later slide. So along with making significant strategic progress, our financial headlines demonstrate that it's been another positive half for the company. Looking at income and earnings in more detail, we've continued to deliver growth in net rental income. This has increased by 17.3% to over 149 million pounds for the half, principally due to the acquisition of the UKCM portfolio in May of 2024, which has now contributed for the whole of the first half of this year. And we continue to operate with an efficient cost base. Our EPRA cost ratio, shown bottom right, is 12.9% excluding vacancy costs. our headline adjusted EPS grew by 6.4% to 4.63 pence. In line with our policy, the overall dividend per share was 3.83 pence, up 4.9% from the prior period, resulting in a consistent dividend payout ratio of 89%. And as the top right-hand chart shows, we continue to have significant embedded rental potential. Our balance sheet remains very strong, underpinned by our high-quality investment portfolio. Over the period, our portfolio value increased by 4.2% to £6.8 billion. This includes a £92 million gain on revaluation. And we continue to generate excellent opportunities to allocate our capital, as you can see on the top right. On the bottom right we show that this has mainly been financed through our disposal programme, with £278 million of assets sold in the year to date. While we've been busy investing for growth and integrating the UKCM assets, we continue to deliver strong underlying total returns. Now this bridge obviously only covers the six month period, but starting on the left with our 2.5% earnings yield, we have incrementally added 1.4% and 0.9% to returns from our investment and development portfolios respectively, delivering an underlying total accounting return of 4.8% for the six months or 9.6% when annualised. There are two items which I've separated from this underlying performance. The first is a reduction relating to the non-core asset performance And the second is an impairment recorded against a single site held on the land option as a result of planning related delays. Both of these items could therefore be considered as non-recurring. All of these movements combined deliver the reported total accounting return of 3.6%. And on the right, we highlight some of the key drivers of value. We continue to see attractive levels of ERV growth. This stood at 2.3% over the last six months or 6% over the past 12 months. Turning to look at our operational performance in more detail, we're pleased to report that our active asset management continues to deliver good levels of rental growth. And you can see here that we've added £5.6 million to our annual rents across the six months. As we outline in the chart on the top left, 17.2% of our contracted rent was either reviewed or subject to lease events in the period, delivering a like for like rent uplift of 10.3% across those leases. Our rental performance in any given year is determined by the proportion of our leases subject to review or lease events. As you can see on the bottom left, 2025 is a year of proportionately lower reviews. But as we look forwards, we have a larger level of reviews falling due in 2026 and 2027, which should lead to an acceleration in income capture. Now looking onto the right, I've shown more detail on how vacancy within the portfolio is evolving and particularly highlighting the difference between our underlying portfolio and those newly developed assets coming through our development pipeline. And after the period end, we were pleased to report the letting of one newly developed unit at Rugby. As a result, you can see the pro forma vacancy figure reduces by over 110 basis points to 4.5% as we stand here today. Turning to our development progress. This slide demonstrates how we continue to create value through our development pipeline. Consistent with last year, we're expecting our activity to be second half weighted. In the period, we had 0.8 million square feet of developments reaching completion, adding one and a half million pounds to passing rent and with the potential to add a further 2.6 million pounds subject to leasing. 0.4 million square feet of this was delivered under a DMA contract. As you know, enhancing our sustainability performance is embedded across all our activities, and this continues to contribute to preserving and creating value. We've outlined here some of the key targets across our four sustainability pillars, and I'm glad to say we're making good progress towards our 2025 targets. And this is all continuing to be reflected in our strong ESG ratings, including MSCI, GRESB and CDP, as outlined along the bottom of the slide. Turning now to our balance sheet. I've already highlighted that this remains strong and it provides us with financial flexibility whilst insulating us from some of the volatility we continue to see in the capital markets. Let's start on the top left, where our debt maturity profile is well diversified by both source and maturity, noting that during the period we have successfully refinanced two loans that were due to mature in the following 12 months. And in the right hand chart, we show that the potential from our rental reversion and vacancy capture, shown in the blue, is expected to far exceed the likely increase in finance costs shown in gold as we gradually refinance our facilities into the future, thus underpinning our future earnings growth. Looking forward, we are continuing to invest for future growth. We are reiterating the guidance we set out at our recent Capital Markets Day. So drawing this all together, it's been another period of progressive operational and financial performance for the business. We've increased our net rental income by over 17%, adjusted EPS by 6.4% and we've delivered a strong underlying 4.8% total accounting return for the half or 9.6% when annualised. And we continue to be in a very strong position looking forwards. supported by our strong balance sheet and our multiple proven funding levers. This underpins our three very clear and compelling growth drivers which we are delivering against. And it's important to note that due to the careful way we think about and manage risk, we believe this gives us the ability to deliver superior risk-adjusted returns through our high-quality investment portfolio and through our attractive logistics and data centre development opportunities. And with that, I'll hand you back to Colin.