Sirius Real Estate Limited

Good morning everybody and welcome to today's presentation of Sirius Real Estate's full year results for the period ending March 31st, 2026. My name is Andrew Coombs, I am the Group Chief Executive Officer of Sirius and I'm joined this morning by Chris Bowman who is the Group Chief Financial Officer of Sirius Real Estate. we will take you through this morning's presentation. As you all know, Sirius is an on-balance sheet, best-in-class owner and operator of mixed-use light industrial business parks on the edge of key towns in Germany and the UK. Please remember that Sirius has for the last four and a half years operated in both the German and the UK markets under the brand of Sirius in Germany and for the last four and a half years under the brand of BizSpace within the UK. The group currently operates over 3 billion euros of property, 90% of which is wholly owned. This consists of over 160 sites and nearly 2,000 commercial buildings. We have 76 sites in the UK, 78 sites in Germany and 7 sites within the Titanium Joint Venture. If we turn to page 6, we can look at the highlights for the period. The Sirius Group is a rigorous, well-run and growing organisation. We have proved the resilience and the reliability of the business model during Brexit, during COVID, during the Liz Trust budget, the Ukraine war and the gas crisis in Germany. and most recently through a period of rising interest rates in Europe and the UK, during which time we have successfully protected valuations despite yield expansion. And in that time, we have continuously grown our revenues, increased our dividend payments, and as I have said, we've made sure that the value of our properties goes up, not down. In the period to March 31st, 2026, we once again grew the group like-for-like rent roll by more than 6%. And as a result of acquisitions in the period, we have grown total rent roll by more than 11%. So I'm pleased to report to you another year of business as usual for Sirius, despite the macroeconomic headwinds and political uncertainty of recent months. We have increased our FFO to more than 133 million euros, which has resulted in a 4.5% increase in FFO per share. And I'm pleased to tell you that we will be paying a dividend of 3.22 cents for the second half of the year. This brings the total dividend for the period to 6.4 cents, which is 4.1% up on the previous year. But where does that leave us in terms of the ambition of this company going forward? Because everything I talk to you about is in the past. Let's spend a couple of slides looking forward. As you know, we have an immediate ambition to get to 150 million euros of FFO. And I say immediate because we should now be less than one year away from achieving that 150 million FFO ambition. And that's why six months ago, we started to roll out our plans to extend our achievement in future years to beyond 150 million and onto the new ambition of 175 million euros of FFO. Now, I know you're all going to ask me when. Well, these are ambitious goals, and they focus the team at Sirius and BizSpace on how. If we were to commit to when, they wouldn't be ambitions, they'd be targets. The importance of the ambition is it focuses our thoughts and our activities on the how. And as you can see, aside from our core business of owning multi-let, out of town industrial parks, two very important pieces of the how are now coming into the picture. namely defence and self-storage. And if you turn to page 8, we can spend a little bit of time talking about our self-storage ambitions. Sirius has been operating its smart space self-storage products in Germany for over 15 years now. Today we are live in over 30 locations in Germany, serving just over 4,000 customers. In the UK, we're doing something similar in just four locations. As you know, we hired Tom Lampard last year. Tom is a former director of Look & Store, and more recently, Shoreguard. He has a great deal of experience in overseeing the planning, the building, and the opening of new self-storage stores. I'm delighted to tell you that we've already started to build our first dedicated self-storage store in Berlin. And we will soon begin the conversion of a small number of sites in the UK into dedicated self-storage stores. And we can see a path to more than doubling our revenues from self-storage. And of course, these stores in every single case, will be even more high-yielding than our traditional core sites. Let's now turn to page nine and look at defence. So back in June of last year, in fact almost to the day, we appointed Angus Fay as a strategic advisor to CIRIS. His remit being to advise the company on the defence sector. At the time, we sought to understand what was happening. Because we believed, and we still do believe, defence capabilities are underpinned by industrial capacity. And that capacity is normally housed in industrial properties. Therefore, if you own industrial property in scale, defence will become unavoidable. And we wanted to understand what sort of effect this might have on the asset class as a whole. By September, it had become clear that this opportunity was one that Sirius should be participating in. And we purchased just over 60 million euros of assets in Munich and in Bedford. Assets that contain tenants from the defence sector. Then in February of this year, we raised capital and purchased a further 140 million euros of defence-related assets in Germany. As you can see from this slide, this leaves us with a portfolio of just over 200 million euros at nearly 9% gross yield. And our ambition is to continue going in order to build somewhere around 500 million euros of defence related property portfolio, at which point we will seek third party capital to form a joint venture focused on the defence sector. We are at least one year away from that, maybe two, but our goal is clear here, our ambition is to go it alone to half a billion and then to go further than that with the help of third-party joint venture capital. That is our ambition. So 150 million of FFOs in our sights. We will not be stopping there. We're already planning the journey to 175. Within that plan, we will be scaling up our presence in self-storage, And where defence is concerned, we've acquired 200 million in 12 months, and we plan to build to 500 million in the future. Perhaps I can now hand over to Chris to take you through the income statement.

Thank you, Andrew. Morning, everybody. I'll just spend the next few pages going through the highlights of the income statement and the balance sheet, and then come back later as well and just talk about some of the capital allocation issues. decisions that were made during the year. So as you've already heard Andrew speak about the FFO, very pleased to have another year of very healthy growth of FFO, 8.4% up year on year to finish the year at €133.5 million. That focus on FFO funds from operations, the cash profits of the business after tax and after financing expenses runs through the entire business. We are not a jam tomorrow real estate business. We're about capturing cash income today. So rental income level, you can see we were up 11.4% year on year to 239.8 million of rental income. I can tell you we actually finished the year with rent rolled well in excess of 250 million euros today. So there is growth baked into our portfolio for the year ahead. Looking further down, just to highlight, we obviously still have the JV with what is now BNP, previously called AXA, with €350 million of assets in Germany. That has been very healthy returns for us. We have €75 million of capital invested in that JV. And as you can see, we've made 8 million return. There was a performance fee in the prior year. That's why it's slightly down. But in terms of ongoing returns there, they continue to be very healthy double digit returns on our equity. Service charger recoverables. This is obviously a focus of the business. This is part of our DNA of doing better than the competition in terms of recovering our property expenses. As we've had a very active year of acquisitions, then we tend to see a slightly higher recoverables as we inherit other people's recovery strategies that will return to more normal levels. We expect to typically recover 92% of property expenses off mid eight years of occupancy. Coming further down, you can see corporate costs and overheads, very pleased to say that we've kept that to a 3% increase despite a portfolio which obviously increased over double digits. So you're seeing operational leverage there. We are getting more efficient. We are doing more with less. We are bringing obviously technology into the business, but also the platform is able to scale. That has driven an 11.6% EBITDA increase to 158.3 million. And you obviously see the benefits of that operational leverage there, offsetting that initial increase in the service charger recoverables. Finance expense continues to be the biggest headwind that the business faces. We are on a journey of going from obviously very, very cheap cost of debt into what I call more normal levels. So I would guide to around 4% incremental cost of debt. I'll talk about that a little bit more later. But you can see net finance expense, 23 million, of which there was a 36 million interest cost with a 13 million income. I would guide you towards the year ahead. The income will be very low single digits. The interest cost will be marginally higher in the year ahead. Tax, you can see we've brought our current tax charge right down 1.8 million from 6.8 million the prior year. We've had some very successful tax structuring during the year, merging loss-making entities, well, entities that have losses in them with our profit-making entities at a property level that's allowed us to release some of the losses in a very efficient manner. I think going forward you should expect that tax charge to return to mid-single digits level, but a very healthy performance this year. And that all feeds into the FFO as I've said, 133.5. Adjusting items I talked about in the first half. There is an unrealised foreign exchange translation in there. There are finance fees associated with our activity, particularly on the RCF and the bond markets. But those together, some of those are one-offs, which will roll back out, in particular the FX. I would then just highlight the surplus on the revaluation. So 110 million increase in our investment properties. That's a reflection of that focus on driving rental income. Yields have essentially been stable. Andrew will come on and talk about those a little bit more later. But they are essentially stable. We have capitalized on the benefit, particularly in Germany. of the upside in rental income. That then feeds through to the NAV, which I'll talk about in a second. But net you get down to a profit for tax up 5% at 211 million. Just putting that into a waterfall, I think when we drive that FFO, that then allows us to grow a dividend. So for the 25th consecutive period, we are very pleased to be announcing an increasing dividend. As Andrew said, 3.22 cents in the second half gets us 6.4 cents overall for the year. The waterfall down from NOI, 207 million, take off the costs and the finance expenses for FFO, together with those adjusting items of FX and finance fees, again, all going in the right direction to drive a dividend growth. Flipping on to the balance sheet, fairly self-explanatory, obviously highly, highly active year for acquisitions of property. In terms of what actually hit the balance sheet in the year, it was roughly €400 million of assets that actually fell in in terms of completions during the year. Together with that valuation uplift of €110 million, you saw an increase in investment properties of just over €500 million. The cash balance, therefore, has shifted slightly down from 604 million to 410 at the year end, reflecting that move into assets. We also did a bond tap during the year for 105 million, and we did an equity raise for 88 million. So piece those three items together, they flowed into the 400 million of completions of assets during the year. I'll just highlight as well, there's quite a big shift on the tax line. You can see that deferred tax dropped from 110 million down to 86 million. I flagged this at the first half, but you see the full effect now of the German government's fiscal stimulus measures have included reducing the corporate tax rate in Germany, which goes from 15% down to 10% over the course of five years from 2028. So that's a real live example of the fiscal stimulus in action. What does that mean? That means that our embedded profits on our portfolio, there is essentially a lower potential tax liability associated with those, so that allows that deferred tax release. But that is obviously direct evidence of the effect of that stimulus, which hasn't actually even come yet. And so it's not actually affecting the economy, but from a sort of deferred tax perspective, we've got visibility on it. That drives down. We've got the three different NAVs there. The basic reported NAV is up 7%. That includes the effect of that deferred tax release. The adjusted NAV, which is the one that we focus on, that strips out the deferred tax, and then the EPRA as well. So each of them up 7%, 5%, and 4% respectively. I will hand back to Andrew now to go through country-by-country KPIs.

So in terms of Germany, the strongest market in the period, as you can see, annualised rent roll up by nearly 18%, obviously partly driven by the acquisitions and partly driven by the 7.3% like-for-like organic growth. Occupancy increased and so did rates. You can see that the move-ins reflecting the new business sales volume was 12% up on the previous year. But, you know, we need to be careful. It's not all good news. We're closely managing the rate in terms of the move-outs. You can see people are moving out at roughly the same level they're moving in at. We normally like to have, you know, a decent 50 cents or so up on the move-in rate versus the move-out rate. Sorry, we've got that. What I mean is March 25 to March 26, instead of driving in, instead of driving down the move-out rate, it's moved up by three cents. So a marginal difference, but nonetheless, these areas are narrowing rather than getting further apart. And then if you look at the move outs, you see that actually the move outs are 34 square meters higher, whereas the move ins are only 26,000 square meters higher. What's missing here is the expansions, the customers who stay but buy more. But suffice it to say, whilst it's the strongest of the two markets, we're still having to work very, very hard to use the platform to keep everything in balance. Sometimes you can see that just pure new business alone will overcome what's moving out. We're having to use both new business and also expansions to be able to make sure we get that extra 1% in occupancy and we continue to drive the rate upwards. If we go across the page and look at the waterfall effect, as you can see, we're losing nearly 21 million, but we're gaining 24.3 in terms of the move-ins. And then really it's the like-for-like uplifts that get us that good healthy growth from 140 to 150. We then have acquisitions on top, and you can see that's how we grow the rent roll by nearly 18% within the year. And then if you look at the acquisitions here on page 15, on the left you can see Dresden, so Silicon Saxony, effectively where all of the offshore chip manufacture from years gone by has been moved back into Germany. This is a particularly strong market. You can also see Geilenkirchen. Geilenkirchen is near to a strategic NATO air base, close to the Dutch border. This is not one of our defence plays, but we love the location of this asset. And the fact that it is located where it is has only added to the reason as to why we bought this high yielding 10.2 gross yielding asset. And then Munch & Gladbach, which we think has got a lot of opportunity based on the low price, the high vacancy. and the fact that it's so well located in an area like Mönchengladbach. But if you have a look at the capital rate per square meter of less than 250 euros per square meter, that clearly is part of the strength of this asset. Then you go across the page again, and you come into the defence-related stuff. Fieldkirchen is where the company makes the night-viewing devices and the laser technology for the German army. Kiel... is 60% Rhine metal so electronics for armoured fighting vehicles and Fulda that was announced last week is where the body armour for the Bundeswehr So, effectively, the anti-ballistic and Kevlar plates are made for the German army. And, of course, with the two new divisions, including the 45th Division in Lithuania, the need for this kit is expanding quite rapidly. So, all of this is growing government-backed, very, very sticky defence income, hence why we bought it. Chris, over to you.