Strong FY25 performance and a bigger, better Hammerson
Hammerson has posted a robust set of FY25 results, showing a business that has scaled up and tightened execution. Total net rental income (NRI) rose 23% to £180m, helped by like-for-like growth and newly acquired joint venture interests. EPRA earnings edged up 5% to £104m, with EPRA EPS up 4% to 20.7p. Importantly, the IFRS line swung to a £232m profit (FY24: £526m loss) after a £120m net revaluation gain.
The balance sheet remains serviceable after an investment-heavy year. Loan to value (LTV) is 39% and the Group highlights annualised net debt:EBITDA of 8.1x. EPRA net tangible assets (NTA) per share increased 6% to £3.94. The dividend is up 6%: a final of 8.56p gives a full-year of 16.50p.
FY25 headline numbers
| Metric | FY25 | FY24 |
|---|---|---|
| Net rental income | £180m | £146m |
| EPRA earnings | £104m | £99m |
| EPRA EPS | 20.7p | 19.9p |
| IFRS profit/(loss) | £232m | £(526)m |
| EPRA NTA per share | £3.94 | £3.70 |
| Dividend per share (FY) | 16.50p | 15.63p |
| Portfolio valuation | £3,549m | £2,659m |
| Loan to value | 39% | 30% |
| Net debt | £1,370m | £799m |
| Net debt:EBITDA (rolling 12 months) | 9.5x | 5.8x |
| Total accounting return | 10.8% | (24.2)% |
Where the growth came from
Scaling up at attractive yields
- Hammerson invested £757m since November 2024 across Westquay, Brent Cross, Bullring and Grand Central, and The Oracle at an average yield of 7.6%.
- The portfolio value is up 33% to £3.5bn (AUM £4.4bn), aided by acquisitions, ERV growth and some yield compression.
- Net revaluation gains of £120m include a £95m gain in flagships, delivering a 10% total property return.
Opinion: deploying capital at a 7.6% yield into prime retail-led city destinations looks sensible if leasing momentum and occupancy hold. The revaluation gain suggests improving investor sentiment for top-tier assets.
Leasing momentum and operational outperformance
- Record leasing of £51m (+18% like-for-like). New deals were done at +46% to previous passing rent and +11% ahead of ERV on a net effective basis – the fourth straight year of positive leasing spreads.
- Occupancy increased to 96%, with six of ten flagship destinations at least 98% occupied.
- £262m of rent is contracted to first break, with a further pipeline of about £20m.
- Like-for-like NRI rose 3% as active asset management and leasing fed through.
Footfall and sales are moving the right way. The Group counted 170m visitors (up 3m like-for-like), with flagship footfall +2% overall and outperformance in every geography versus local benchmarks. Second-half footfall accelerated to +3% year-on-year, helped by new openings and repositioning – notably The Oracle (+9%) and Cabot Circus (+6%). Sales densities were up 2%, improving affordability for tenants.
Opinion: leasing at double-digit premia to ERV is a strong tell for sustained demand in prime centres. Combine that with 96% occupancy and rising footfall, and you have a backdrop supportive of rental growth into FY26.
Platform efficiency kicking in
- EPRA cost ratio improved by 3.9 percentage points to 35.9%, with more reductions targeted in FY26 and beyond.
- Like-for-like ERV growth of 2.7% and passing rent growth of 3.3% in flagships underline embedded upside.
Opinion: cost discipline matters just as much as leasing. The lower cost ratio gives operating leverage as the larger portfolio beds in.
Balance sheet, funding and risk checks
- LTV sits at 39%, with annualised net debt:EBITDA of 8.1x. On a rolling 12-month basis, net debt:EBITDA is 9.5x. Interest cover is 5.06x.
- Liquidity is £970m. During the year, Hammerson issued a heavily oversubscribed €350m 3.5% bond, signed a new unsecured £100m term loan maturing 2028, and repaid a £338m 3.5% bond at maturity.
- There were credit rating uplifts – Fitch Senior Unsecured to A- and Moody’s Baa2 to positive outlook – and a front-footed 10% equity raise to part-fund Bullring and Grand Central.
Opinion: leverage is higher after the acquisition spree, and net debt has risen to £1,370m. That said, the rating moves, interest cover of just over 5x, and extended maturities point to a resilient capital structure. The key is execution: keeping occupancy high and cash generation improving to delever over time.
Guidance: double-digit growth targeted in FY26
Management expects in FY26:
- Total NRI growth of about 20%, with like-for-like NRI growth of roughly 4-5%.
- EPRA earnings growth of about 15% and EPRA EPS growth around 10%.
They flag high visibility on long-term income streams, with further growth in NRI and EPRA earnings anticipated in FY27 and beyond. The macro environment remains uncertain, but the operational set-up – strong leasing spreads, high occupancy and improving footfall – gives credibility to the targets.
What this means for investors
- Positive: clear operational momentum. Four years of positive leasing spreads, 96% occupancy and rising footfall suggest Hammerson’s prime assets are on the right side of retail’s “best vs the rest” divide.
- Positive: dividend growth of 6% and a 6% increase in EPRA NTA per share to £3.94 show both income and capital progress.
- Neutral-to-cautious: leverage is up. LTV at 39% is fine for the asset class, but net debt:EBITDA needs to trend lower as integration benefits and earnings growth arrive.
- Watch: delivery on repositionings (Cabot Circus and The Oracle lease-up; Cergy 3 in France launching and due to open H1 27, targeting about €2.5m annualised NRI) and the lease-up of the 122-unit Ironworks residential scheme at Dundrum.
Bottom line: a stronger, larger Hammerson is emerging, with guidance pointing to another year of growth. Execution on leasing and cost control will be the swing factors for returns.
Jargon buster (quick and simple)
- Net rental income (NRI): rental income after property operating costs.
- EPRA earnings/EPS: an industry measure of underlying profit that strips out valuation swings and other items, giving a cleaner view of recurring performance.
- EPRA NTA: a net asset value measure focused on the long-term value of the property portfolio.
- Loan to value (LTV): net debt divided by the value of the property portfolio.
- ERV: estimated rental value – the market rent an asset could achieve today.
- Passing rent: rent actually being paid now under existing leases.
- Leasing spread: the percentage difference between new lease terms and the prior terms or ERV.
Useful links and next steps
Hammerson is hosting an FY25 results presentation and webcast at 8.00am GMT:
- Results materials: FY25 results page
- Webcast link: Join the webcast
If you’re tracking the story, keep an eye on FY26 leasing run-rate, occupancy progression in the repositioned assets, and the pace of earnings growth versus the stated targets.
