Civitas social housing - profile image - 25062019 - JPG

Civitas Social Housing

LN: CSH

£532.2m market cap

85.6p last close

Civitas is the leading listed UK social housing REIT. Its investment objective is to provide an attractive level of income, with the potential for capital growth, from investing in a diversified portfolio of fully developed social homes, particularly specialist supported housing for vulnerable adults.

Investment summary

Civitas invests in specialist supported social housing (SSH) assets, fully let on long inflation-adjusted leases that provide strong visibility of contractual income. It also delivers a strong positive social return, providing much needed private investment capital to housing associations to provide and manage additional care-based quality accommodation to some of the most vulnerable in society. FY19 assets and income grew strongly and EPRA earnings more than doubled. Dividend growth is continuing with the company targeting a 6% increase in DPS to 5.3p for the current year. Q1 EPRA NAV increased to 107.2p and annualised rent roll reached £46.0m. The recently agreed £60m debt facility, with accordion option to increase this by £40m, provides funding for further acquisitions as the company seeks to gear the existing equity base towards its 35% target. Our forecasts assume an additional c £170m of debt-funded acquisitions in the current year. Modest recent (c £0.4m) share buy-backs at c 85p per share are accretive to earnings and NAV.

Y/E Mar
Revenue (£m)
EBITDA (£m)
PBT (£m)
EPS (p)
P/E (x)
P/CF (x)
2018A 18.6 9.7 9.1 1.44 59.4 N/A
2019A 35.7 26.1 22.6 3.63 23.6 N/A
2020E 50.3 41.0 32.7 5.25 16.3 N/A
2021E 56.8 47.2 36.5 5.86 14.6 N/A
Industry outlook

The chronic shortage of SSH is forecast to increase, yet compared with the alternatives of residential care or hospitals it is widely recognised to improve lives in a cost-effective manner.

Last updated on 19/11/2019
Share price graph
Balance sheet
Forecast net cash (£m) 341
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual (1.6) 1.4 (20.0)
Relative* (3.8) (1.3) (24.2)
52-week high/low 108.0p/76.7p
*% relative to local index
Key management
Paul Bridge CEO
Graham Peck CFO