41061 Unite AR22 HI-RES WEB-READY - Flipbook - Page 42
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THE UNITE GROUP PLC | Annual Report and Financial Statements 2022
FINANCIAL REVIEW continued
FINANCIAL PERFORMANCE
The Group uses alternative performance measures (APMs), which are not defined or specified under IFRS. These APMs,
which are not considered to be a substitute for IFRS measures, provide additional helpful information and include, among
others, measures based on the European Public Real Estate Association (EPRA) best practice recommendations. The metrics
are used internally to measure and manage the business.
EPRA and adjusted earnings
We delivered a strong operating performance in 2022, with adjusted earnings increasing by 48% to £163.4 million (2021:
£110.1 million), reflecting an increase in rental income and broadly stable costs, including interest, when compared to the
prior year. Adjusted EPS also increased by 48% to 40.9p (2021: 27.6p).
2022
£m
2021
£m
Rental income
339.7
282.7
Property operating expenses
(98.7)
(90.9)
Net operating income (NOI)
241.0
191.8
NOI margin
70.9%
67.8%
17.4
15.9
Management fees
Overheads
(27.7)
(31.5)
Finance costs
(63.0)
(63.3)
(5.8)
(2.8)
Development and other costs
LSAV performance fee
EPRA earnings
LSAV performance fee
Abortive acquisition costs
–
41.9
161.9
152.0
–
(41.9)
1.5
–
Adjusted earnings
163.4
110.1
Adjusted EPS
40.9p
27.6p
EPRA EPS
40.5p
38.1p
EBIT margin
67.9%
62.3%
A reconciliation of profit after tax to EPRA earnings and adjusted earnings is set out in note 2.2b of the financial statements.
Sales, rental growth and profitability
Rental income increased by £57.0 million to £339.7 million, up 20%, as a result of higher occupancy, rental growth and
the removal of pandemic-related restrictions and rental discounts. Like-for-like rental income, excluding the impact of
acquisitions, disposals and development completions, increased by 23% during the year.
This exceeded the 14% increase in operating expenses for like-for-like properties, primarily driven by increased utility costs
as a result of higher occupancy, increased staff costs and greater investment into marketing to drive sales for the 2022/23
academic year.
Total net operating income increased by 26% to £241.0 million, translating to an increase in NOI margin to 70.9%
(2021: 67.8%).