Picton Property Income

LN: PCTN

£501.1m market cap

91.5p last close

Picton Property Income is an internally managed UK REIT that invests in a diversified portfolio of commercial property across the UK. It is total return driven with a strong income focus and aims to generate attractive returns through pro-active management of the portfolio.

Investment summary

H120 results to 30 September will be published on 12 November. Q120 NAV total return was 1.3% comprising a 0.3% increase in EPRA NAV per share to 93.0p and a quarterly dividend paid of 0.875p (an annualised 3.5p). An overweighting of industrial and regional offices properties and an underweighting of retail and leisure continues to be a benefit. The current year focus is on asset management projects aimed at capturing strong reversionary rent potential, enhancing the quality of the assets and generating additional value. A recent portfolio update provided details of progress across all sectors with the completion of 20 asset management initiatives including lettings, lease renewals, regears and rent reviews. Refurbishments are temporarily impacting income, but dividends remained fully covered in Q120 and income should build through the year. Moderate gearing (Q120 LTV: 24.1%) provides funding flexibility for any acquisition opportunities that may emerge.

Y/E Mar
Revenue (£m)
EBITDA (£m)
PBT (£m)
EPS (p)
P/E (x)
P/CF (x)
2018A 38.4 N/A 64.7 4.2 21.8 14.1
2019A 38.3 N/A 31.4 4.3 21.3 14.2
2020E 35.2 N/A 26.0 3.9 23.5 16.9
2021E 37.3 N/A 24.7 4.2 21.8 15.2
Industry outlook

The supply demand balance for regional office and industrial property remains generally firm, and a positive yield spread between the regions and London offers potential for further narrowing. Rents and capital values in the retail sector have continued to weaken.

Last updated on 11/11/2019
Share price graph
Balance sheet
Forecast net debt (£m) 175.3
Forecast gearing ratio (%) 34
Price performance
%
1m
3m
12m
Actual 2.8 2.1 4.9
Relative* 1.5 0.2 1.3
52-week high/low 98.6p/79.4p
*% relative to local index
Key management
Nicholas Thompson Chairman
Michael Morris CEO
Andrew Dewhirst FD

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