41061 Unite AR22 HI-RES WEB-READY - Flipbook - Page 45
STRATEGIC REPORT
GOVERNANCE
FINANCIAL STATEMENTS
43
OTHER INFORMATION
Summary balance sheet
31 December 2022
£m
Rental properties
Total
£m
Share of
fund/JV
£m
Total
£m
1,773
5,396
3,323
1,542
4,865
–
90
98
–
98
204
–
204
324
–
324
3,917
1,773
5,690
3,745
1,542
5,287
(1,734)
(1,030)
(492)
(1,522)
Share of
fund/JV
£m
3,623
90
Rental properties (leased)
Properties under development
Total property
Net debt
31 December 2021
Whollyowned
£m
Whollyowned
£m
(1,210)
Lease liability
(90)
Other assets/(liabilities)
(97)
(524)
–
(54)
(90)
(94)
–
(94)
(151)
(107)
(32)
(139)
EPRA net tangible assets
2,520
1,195
3,715
2,514
1,018
3,532
IFRS NAV
2,597
1,195
3,792
2,510
1,018
3,528
LTV
31%
29%
Total accounting return
Growth in EPRA NTA was the key component of the 8.1% total accounting return delivered in the year (2021: 10.2%), alongside
dividends paid of 26.6p (2021: 19.25p). Our adjusted EPS yield (measured against opening NTA) increased to 4.6% in the year
(2021: 3.4%), reflecting the growth in recurring earnings.
We expect to deliver a total accounting return of 8–10% in 2023 before the impact of any property yield movements.
This reflects our guidance for growing recurring earnings and strong rental growth for the 2023/24 academic year.
Cash flow and net debt
The Operations business generated £134.1 million of net cash in 2022 (2021: £108.1 million) and net debt increased to
£1,734 million (2021: £1,522 million). The key components of the movement in net debt were:
•
•
•
•
•
•
Disposal proceeds of £256 million
Operational cash flow of £141 million on a see-through basis
The acquisition of units in USAF for (£141 million)
Total capital expenditure of (£355 million)
Dividends paid of (£94 million)
A (£19 million) outflow for other items
In 2023, we expect see-through net debt to increase as planned capital expenditure on investment and development activity
will exceed anticipated asset disposals.
Debt financing and liquidity
During the year, we witnessed a significant increase in Government bond yields, as well as credit spreads for publicly traded
debt, as markets reacted to higher inflation and a tightening of monetary policy by central banks. In the period immediately
following the UK’s mini-budget in September 2022, new borrowing costs rose to prohibitive levels for new investment activity.
Encouragingly, there has been a significant easing in funding market conditions over recent months and lenders remain
supportive of the Group and the student accommodation sector.
We are well protected from significant increases in borrowing costs through our well-laddered debt maturity profile and
forward hedging of interest rates, but still expect to see our borrowing costs increase over time as we refinance our relatively
inexpensive in-place debt.