Sirius Real Estate’s H1 2025: profit surges, dividend rises, and FFO keeps climbing
Sirius Real Estate has posted a punchy first half. Profit after tax jumped 56.8% to €87.0 million, and the interim dividend is up 4.0% to 3.18c per share. Under the bonnet, funds from operations (FFO) – a cash-like measure many property investors favour – rose 6.6% to €64.7 million, with FFO per share nudging up to 4.30c.
The engine remains the operating platform: like-for-like rent roll was up 5.2% across Germany and the UK, and total rent roll leapt 15.2% to €242.5 million thanks to a busy acquisition programme.
| Key numbers (six months to 30 Sep 2025) | H1 2025 | H1 2024 |
|---|---|---|
| Revenue | €162.3m | €156.5m |
| Net operating income | €95.1m | €92.4m |
| FFO | €64.7m | €60.7m |
| FFO per share | 4.30c | 4.29c |
| Profit before tax | €57.5m | €61.2m |
| Profit after tax | €87.0m | €55.5m |
| Dividend per share | 3.18c | 3.06c |
| Total rent roll | €242.5m | €210.5m |
| Like-for-like rent roll growth | 5.2% | – |
| Owned portfolio value | €2,765.4m | €2,465.2m (31 Mar 2025) |
| Adjusted NAV per share | 117.84c | 118.89c (31 Mar 2025) |
| Net LTV | 38.3% | 31.4% (31 Mar 2025) |
| Weighted average cost of debt | 2.5% | 2.6% (31 Mar 2025) |
What moved the dial in the half
Strong rent growth, helped by timely acquisitions
Like-for-like rent roll climbed 5.3% in Germany and 5.1% in the UK, showing the platform is still pushing pricing and renewals. Total rent roll growth of 15.2% reflects acquisitions, notably the Hartlebury Industrial Estate in the UK, plus a string of German light industrial deals.
Service quality is holding up: cash collection on a 12‑month rolling basis was 97.7% at Group level. Occupancy dipped slightly to 83.2% (like-for-like occupancy improved to 85.1%), which is acceptable given the inflow of new space from acquisitions and value-add projects.
Tax law change turbo-charged reported profit
The eye-catching profit after tax figure owes a lot to Germany’s enacted corporate tax rate cut (from 15% to 10% phased 2028–2032). That allowed a €34.7 million release of deferred tax liabilities. It is non-cash, but it does improve future run-rate economics.
FX knocked profit before tax and EPRA earnings
Profit before tax slipped 6.0% to €57.5 million, mainly because of a €14.2 million foreign exchange loss on sterling cash held ahead of UK investments. This, plus timing of acquisitions after the July 2024 equity raise, dragged EPRA earnings per share down 28.8% to 2.84c even as FFO grew. In plain English: the cash engine is fine, but accounting effects and FX masked it at the EPS line in the half.
Portfolio performance: Germany vs the UK
- Germany: like-for-like rent roll up 5.3% to €142.5 million; average like-for-like rate per sqm up 4.7% to €7.73; occupancy stable to slightly better. Portfolio gross and net yields at 7.5% and 6.7%.
- UK (BizSpace): like-for-like rent roll up 5.1% to £60.4 million excluding Vantage Point; occupancy up to 89.0%. The addition of Hartlebury (lower average rent per sq ft, higher industrial weighting) pulled the portfolio’s average rate down 8.7% to £11.52 per sq ft, but boosted total rent roll to £79.5 million.
Group EPRA net initial yield sits at 6.8% (Germany 6.2%, UK 8.3%), with the UK’s tighter yield reflecting a pivot toward industrial assets that investors currently prize.
Balance sheet: low-cost debt, solid liquidity, but LTV higher
Debt remains sensibly priced: a 2.5% weighted average cost and 3.7 years average maturity. Liquidity is healthy with €389.0 million of cash on hand at 30 September 2025 and a new €150.0 million undrawn revolving credit facility. Sirius also tapped its 1.75% 2028 bond for an extra €105.0 million to support the acquisition pipeline.
Net loan-to-value (LTV) has risen to 38.3% from 31.4% as the war chest has been deployed into property. That is within the stated 40% cap, but it is near the top of management’s comfort zone, so I would expect a steadier pace of deployment or selective disposals from here. The €400.0 million bond maturing in June 2026 is slated to be repaid from cash and the RCF, which looks manageable. Fitch reaffirmed the BBB rating with Stable Outlook in October 2025.
Valuations and NAV: income doing the heavy lifting
The owned investment property portfolio grew 12.2% to €2,765.4 million, driven by €295.0 million of acquisitions and a €14.4 million asset-management-led valuation uplift. Despite that, adjusted NAV per share edged down 0.9% to 117.84c and EPRA NTA per share fell 1.4% to 115.94c, mainly due to unrealised foreign currency translation effects from the UK assets when translated into euros.
For me, the takeaway is that income growth is doing the hard work while FX noise is tugging on the headline per-share NAV. That is not unusual for a cross-border owner-operator with euro reporting and sterling assets.
Strategy in action: recycling, capex and deals
Sirius bought eleven assets in the period (one completed post period end) for €338.7 million including costs, with €295.0 million falling in the half. Notably in the UK, Hartlebury (£107.0 million) and Southampton (£42.8 million) add scale in industrials and logistics. Germany saw several light-industrial additions with attractive day-one income and room for value-add.
On the capex side, the value-add programme in Germany keeps delivering: over the last three years, 293,824 sqm has been transformed for €31.2 million, generating €12.7 million rent roll at 74% occupancy – a 41% ROI. Renewal capex has returned 54% on average. That is precisely the sort of tangible, repeatable return that underpins FFO growth and supports the dividend.
What investors should like – and what to watch
Positives
- Like-for-like rent roll growth above 5% in both countries – pricing power is intact.
- FFO up 6.6% and dividend up 4.0% to 3.18c – the 24th consecutive increase.
- Low 2.5% cost of debt and ample liquidity including an undrawn €150.0 million RCF.
- High cash collection at 97.7% and sticky tenant base across SMEs and anchors.
- Capex programmes with 41% and 54% average ROIs over three years – value creation beyond market beta.
Watch items
- EPRA earnings per share down 28.8% to 2.84c, reflecting FX and acquisition timing – management expects per-share earnings to improve as new assets contribute in H2 and beyond.
- Net LTV up to 38.3% (target cap 40%) – room is there, but headroom is tighter.
- NAV per share dipped due to unrealised FX translation on UK assets – currency remains a swing factor.
- Portfolio occupancy at 83.2% overall – like-for-like improved, but new acquisitions will need leasing work to drive the next leg of growth.
Outlook and my view
Management says trading is in line with expectations and flags further growth potential, especially in Germany, using existing firepower and recycling mature assets. With the 2024 equity raise now fully invested and rent roll up 15.2% year on year, I’d expect FFO and EPRA earnings per share to benefit as the later-in-the-period deals roll through the P&L.
In short: this was a good, cash-generative half masked by FX at the EPS level. The dividend keeps moving up, operational KPIs are strong, and the balance sheet is investment-grade with low-cost debt. The main risks to watch are currency effects and staying within that 40% LTV guardrail while executing the leasing plans on the newly acquired estates.
For investors who want exposure to multi-let industrial and business parks in Germany and the UK, operated through a proven platform, these numbers reinforce the quality of the model. The second half should be the decider on whether the per-share earnings trajectory reaccelerates as promised.
