(Correcting that Schroder European decided to rebase its dividend in June 2023)
(Alliance News) - Schroder European Real Estate Investment Trust PLC on Friday reported it had returned to annual profit as loss from fair value adjustment on investment property waned.
For the financial year that ended September 30, the London and Johannesburg-listed property investor's pretax profit was EUR1.3 million, swung from a loss of EUR10.0 million a year earlier.
Net loss from fair value adjustment on investment property dwindled to EUR7.7 million from EUR19.7 million.
Net rental and related income was up 4.9% to EUR15.0 million, compared to EUR14.3 million.
Schroder European declared a fourth interim dividend of 1.48 euro cents for the year.
The company decided to rebase its dividend in June 2023 to reflect rising interest rates and capital deployment strategy.
It said at the time that the quarterly target minimum dividend will be rebased to 1.48 cents per quarter, starting from the third interim dividend payable in October 2023.
IFRS earnings per share swung to 0.4 cents, from a loss of 7.0 cents, while headline earnings per share rose to 6.1 cents from 6.0 cents.
Net asset value per share was 122.7 cents as at September 30, down 4.3% from 128.2 cents at September 30, and was down 0.7% from 123.6c at March 31.
Schroder European also said the French tax authorities are proceeding with a tax audit. The potential exposure is up to EUR12.6 million, excluding penalties, it said.
"Based on professional advice, the board continue to believe that an outflow is not probable, and therefore no provision is recognised," the company said.
Non-Executive Director Mark Patterson will step down before the annual general meeting in March 2025.
"Despite the broader challenges facing smaller REITs, the Company is well positioned, with a differentiated and compelling investment thesis focused on assets with robust property fundamentals in higher growth European cities," Schroder European Chair Julian Berney said.
Shares in Schroder European were unchanged at ZAR16.74 on Friday afternoon in Johannesburg. In London, they were up 3.5% at 70.40 pence.
By Artwell Dlamini, Alliance News reporter
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