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  • Strong first half results and operating metrics, reflecting a portfolio which is well-positioned to take advantage of favourable occupational and investment market conditions.
  • Adjusted pre-tax profit up 23 per cent reflects the acquisition of the Airport Property Partnership (APP) portfolio, development-led growth and our focus on customer and portfolio management, which delivered high customer retention rates, a continuing low vacancy rate and strong like-for-like rental growth.
  • Adjusted EPS up 3.2 per cent to 9.7 pence (H1 2016: 9.4 pence1), incorporating the new shares issued in the March rights issue. IFRS EPS of 41.3 pence (H1 2016: 24.8 pence1), was higher due mainly to increased valuation gains on our investment portfolio.
  • EPRA NAV per share up 5.4 per cent to 504 pence (31 December 2016: 478 pence1), driven by a 4.9 per cent increase in the value of the portfolio, due primarily to development and asset management gains, as well as yield compression.
  • Successful £557 million rights issue has created significant capacity for growth. Three quarters of the proceeds already deployed or allocated to specific investment opportunities, including taking full ownership of the APP portfolio of industrial property at and around London’s airports.
  • Future earnings prospects underpinned by largely de-risked and fully funded development programme. The current development pipeline is capable of generating £46 million of rent, £31 million of which has been secured through pre-lets. In addition, near-term projects associated with a further £14 million of potential rent are at advanced stages of discussion.
  • Interim dividend increased by 5.0 per cent to 5.25 pence (2016 interim dividend: 5.0 pence1).

Commenting on the results, David Sleath, Chief Executive, said:

“SEGRO has delivered another strong set of results in H1 2017, underpinned by active development and asset management as well as further portfolio valuation growth.

“Whilst political and economic uncertainty has increased in the UK, we are encouraged by the continued leasing momentum across our portfolio. Furthermore, business confidence in Continental Europe has picked up in recent months and there is no sign of any slowdown in the growth of internet retailing which is an important driver of demand for modern warehouse space across our markets, both in big boxes used for logistics and smaller, urban warehouses used for last mile delivery. With few signs of any meaningful new supply of speculatively developed space and investor appetite for good quality warehouse assets remaining strong, our business is well-placed to continue outperforming the wider market.”


Strong development and asset management activity, supported by positive market conditions

  • 28 per cent increase in new rent contracted in the period to £27.5 million (H1 2016: £21.5 million), of which £18.4 million (H1 2016: £8.7 million) is from new development pre-let agreements and lettings of speculative space prior to completion.
  • 3.9 per cent like-for-like net rental income growth, including 5.9 per cent in the UK and stable rents in Continental Europe, aided by a 15 per cent uplift on rent reviews and renewals in the UK portfolio, capturing reversionary potential accumulated in recent years.
  • Portfolio occupancy remains high with a vacancy rate of 5.5 per cent (31 December 2016: 5.7 per cent).

Valuation gains across the portfolio reflecting continued investor demand and asset management gains

  • Portfolio capital value growth of 4.9 per cent (UK 5.3 per cent, Continental Europe 3.9 per cent) from asset management initiatives and market-driven yield compression (20 basis points across the portfolio), rental value growth (0.9 per cent UK; 0.4 per cent Continental Europe) and development gains.

Capital allocation focused on accretive development programme and on securing full ownership of the Airport Property Partnership (APP) portfolio

  • £46 million of potential rent from current development pipeline, of which 68 per cent has been secured through pre-lets. Completions in the second half of 2017 potentially generate £29 million of rent, of which £21 million has been secured.
  • Further ‘near-term’ pre-let and speculative projects associated with £14 million of rent are at advanced stages of discussion.
  • Total development capex for full year expected to exceed £350 million.
  • Acquisition of 50 per cent of the £1.1 billion APP portfolio not previously owned allowing us to add scale in the attractive Heathrow market and to take full advantage of significant asset management and development opportunities.

Balance sheet strengthened with £1.1 billion of new financing agreed in the period

  • £557 million of (net) proceeds from the rights issue in March provided capital to acquire APP portfolio and to pursue further development. Approximately three quarters of the proceeds have been invested or are allocated to specific current or near-term development projects.
  • €650 million of debt from a US private placement which was signed during the period and will be drawn in August 2017, improving the strength and duration of our capital structure and reducing the overall cost of debt by 30 basis points.
  • Look-through LTV ratio of 29 per cent (31 December 2016: 33 per cent).

1 Historic metrics for earnings per share, dividend per share and net asset value per share have been adjusted by a bonus adjustment factor of 1.046 to reflect the rights issue carried out in March 2017.
Figures quoted on pages 1 to 13 refer to SEGRO’s share, except for land (hectares) and space (square metres) which are quoted at 100 per cent, unless otherwise stated. Please refer to the Presentation of Financial Information statement in the Financial Review for further details.

Income statement metrics                     6 months to
30 June 2017
 6 months to
30 June 2016
Change per cent
Adjusted2 profit before tax (£m) 91.2 74.2 22.9
IFRS profit before tax (£m) 397.1 200.7 97.9
Adjusted3 earnings per share (pence) 9.7 9.4 3.2
IFRS earnings per share (pence) 41.3 24.8 66.5
Dividend per share (pence) 5.25 5.00 5.0


Balance sheet metrics 30 June 2017 31 December 2016 Change per cent
Portfolio valuation (SEGRO share, £m) 7,277 6,345 4.66
EPRA4 5 net asset value per share (pence, diluted) 504 478 5.4
IFRS net asset value per share (pence, diluted) 504 480 5.0
Group net borrowings (£m) 1,742 1,598 9.0
Loan to value ratio including joint ventures at share (per cent) 29 33

1 Per share figures have been adjusted by a bonus adjustment factor of 1.046 to reflect the rights issue in March 2017.
2 A reconciliation between Adjusted profit before tax and IFRS profit before tax is shown in Note 2 to the condensed financial information.
3 A reconciliation between Adjusted earnings per share and IFRS earnings per share is shown in Note 11 to the condensed financial information.
4 A reconciliation between EPRA net asset value per share and IFRS net asset value per share is shown in Note 11 to the condensed financial information.
5 Calculations for EPRA performance measures are shown in the Supplementary Notes to the condensed financial information.
6 Percentage valuation movement during the period based on the difference between opening and closing valuations for completed properties, adjusting for capital expenditure, acquisitions and disposals.

View the full press release in PDF format.

Full details of our holdings can be found in the SEGRO Property Analysis Report.

Watch a video interview with David Sleath, Chief Executive.


A live webcast of the results presentation will be available from 09.00 (UK time) at:

The webcast will be available for replay at SEGRO’s website at: by the close of business.

A conference call facility will be available at 09:00 (UK time) on the following number:
Dial-in: +44 (0) 20 3059 8125
Access code: SEGRO Half Year Results
An audio recording of the conference call will be available until 1 August 2017 on:
UK & International:   +44 (0) 121 260 4861
USA:     +1 844 230 8058
Access code: 6449248#

A video interview with David Sleath, Chief Executive, discussing the results is now available to view on, together with this announcement, the H1 2017 Property Analysis Report and other information about SEGRO.

2017 interim dividend ex-div date 17 August 2017
2017 interim dividend record date 18 August 2017
2017 interim dividend scrip dividend price announced 24 August 2017
Last date for scrip dividend elections 8 September 2017
2017 interim dividend payment date 29 September 2017
2017 Third Quarter Trading Update 19 October 2017
Full Year 2017 Results 16 February 2018


SEGRO is a UK Real Estate Investment Trust (REIT), and a leading owner, manager and developer of modern warehouses and light industrial property. It owns or manages 6.3 million square metres of space (68 million square feet) valued at over £8 billion serving customers from a wide range of industry sectors. Its properties are located in and around major cities and at key transportation hubs in the UK and in nine other European countries.

Forward-Looking Statements: This announcement contains certain forward-looking statements with respect to SEGRO’s expectations and plans, strategy, management objectives, future developments and performances, costs, revenues and other trend information. These statements are subject to assumptions, risk and uncertainty. Many of these assumptions, risks and uncertainties relate to factors that are beyond SEGRO’s ability to control or estimate precisely and which could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements. Certain statements have been made with reference to forecast process changes, economic conditions and the current regulatory environment. Any forward-looking statements made by or on behalf of SEGRO are based upon the knowledge and information available to Directors on the date of this announcement. Accordingly, no assurance can be given that any particular expectation will be met and SEGRO’s shareholders are cautioned not to place undue reliance on the forward-looking statements. Additionally, forward-looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Other than in accordance with its legal or regulatory obligations (including under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules), SEGRO does not undertake to update forward-looking statements to reflect any changes in events, conditions or circumstances on which any such statement is based. Past share performance cannot be relied on as a guide to future performance. Nothing in this announcement should be construed as a profit forecast.

Neither the content of SEGRO’s website nor any other website accessible by hyperlinks from SEGRO’s website are incorporated in, or form part of, this announcement.

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