Social Housing Reit Plc · LSE:SOHO
Social Housing Reit — Triple Point Social Housing REIT — H1 2024 Earnings Presentation
33 slides from Social Housing Reit's earnings presentation, September 2024
Slide 1: 2024 Interim Results Presentation
2024 Interim Results Presentation September 2024
Slide 2: Agenda
AGENDA Triple Point Social Housing REIT plc – Board Highlights Max Shenkman Financial Overview Isobel Gunn-Brown Chris Phillips Tracey Fletcher-Ray Ian Reeves CBE Cecily Davis Peter Coward Chair Senior Independent Director Non-Executive Director Non-Executive Director Non-Executive Director Operatio
Slide 3: Why SOHO?
WHY SOHO? Chronic undersupply of Strong operational Valuation resilience Social Housing performance of portfolio Strong rental growth and Covered dividend 100% long-term and increased rent collection fixed-priced debt 3
Slide 4: Resilient Financial Performance
RESILIENT FINANCIAL PERFORMANCE 93.3% 2.74p 5.46p 1.00x Rent Collection Adjusted EPS FY24 Dividend Target Dividend Cover (Dec-23: 90.2%) (Jun-23: 2.10p) (FY23: 5.46p) (Dec-23: 0.85x) 112.38p £652.7m1 37.2% 5.96% EPRA NTA per Share Portfolio Value LTV EPRA Net Initial Yield (Dec-23: 113.76p) (Dec-23:
Slide 5: Continued Income Growth and Compelling Capital Structure
CONTINUED INCOME GROWTH AND COMPELLING CAPITAL STRUCTURE 100% 6.1% 2.74% 9.1 years Weighted average rent increases of Leases linked to inflation or 100% of debt is fixed priced with a Long-term debt with a weighted 2024 uplifts in the period, representing Government policy1 weighted average cost of
Slide 6: Valuation Resilience Underpinned by Excess Demand and Rental Growth
VALUATION RESILIENCE UNDERPINNED BY EXCESS DEMAND AND RENTAL GROWTH Portfolio Value (£m) Assets Held for Sale Blended IFRS Valuation NIY 5.97% £800m 5.71% 6.00% 5.49% 5.25% £21.8m 5.00% Blended IFRS Valuation NIY £600m 4.00% Portfolio Value £400m 3.00% £642.0m £669.1m £678.4m £652.7m 2.00% £200m 1.0
Slide 7: Increasing Rent Collection
INCREASING RENT COLLECTION Rent collection increased to Historical Rent Collection Decreased rent collection reflects material rent arrears of Parasol and My Space 93.3% in the six months to 30 June 2024 100% 80% 26 out of 28 lessees with no 60% material arrears 100% 100% 100% 100% 100% 91.8% 90.2%
Slide 8: Delivering on Strategic Initiatives
DELIVERING ON STRATEGIC INITIATIVES June 2024 June 2024 August 2024 September 2024 Work commenced on market Dividend fully covered on a Fitch reaffirms investment Review of pilot phase of leading Chorley development run-rate basis grade rating1 Eco-Retrofit project January 2024 June 2024 August 2024
Slide 9: Progress Made on Rent Arrears
PROGRESS MADE ON RENT ARREARS Detailed, resident focused four-month lease transfer plan Working with My Space to agree transfer of leases Engaging with alternative Registered Providers with regards to Lease transfer to Westmoreland completed on 19 August 2024 taking on My Space properties Target at
Slide 10: Portfolio Sale
PORTFOLIO SALE Head of Terms agreed on Portfolio is representative of wider Group portfolio c.£20m portfolio; transaction expected to complete in November Sale Portfolio SOHO Portfolio1 EPC A to C 69% 71% EPC D 30% 22% Highly representative portfolio as demonstrated by key metrics WAULT 19 years 24
Slide 11: Financial Overview
FINANCIAL OVERVIEW
Slide 12: Statement of Comprehensive Income
STATEMENT OF COMPREHENSIVE INCOME Six months to Six months to Year ended % change £’000 4.9% 30 June 2024 30 June 2023 31 December 2023 Jun 24 v Jun 23 Rental Income 20,540 19,576 39,839 5% Increase in Rental Income Expected Credit Loss (“ECL”) (1,436) (3,157) (4,593) (55)% Other Income 3 - - - Tota
Slide 13: Statement of Financial Position
STATEMENT OF FINANCIAL POSITION Six months to Six months to Year ended % change £’000 (1.2)% 30 June 2024 30 June 2023 31 December 2023 Jun 24 v Dec 23 Investment property (IFRS valuation) 648,848 665,422 675,497 (4)% EPRA NTA Growth per Share Asset held for sale 21,755 7,871 - - Trade and other rec
Slide 14: EPRA NTA Reflecting Valuation Resilience
EPRA NTA REFLECTING VALUATION RESILIENCE EPRA NTA per share bridge 120 118 2.90p 116 -1.55p 114 113.76p 112.38p EPRA NTA per Share 112 -2.73p 110 108 106 104 102 100 EPRA NTA EPRA Earnings Property Revaluation Dividends Paid EPRA NTA 31-Dec-23 30-Jun-24 14
Slide 15: Total Accounting Return
TOTAL ACCOUNTING RETURN 1.2% 2.73p 49.1% FY24 Dividend Paid in Cumulative Total Accounting Total Return for H1 2024 line with Target1 Return Since IPO Total Accounting Return since IPO 55% 49.1% 155 EPRA NTA plus Cumulative Dividends Cumulative Total Accounting Return 45% 145 35% 135 paid per Share
Slide 16: Strong Credit Position with Investment Grade Credit Rating
STRONG CREDIT POSITION WITH INVESTMENT GRADE CREDIT RATING Interest Cover Significant covenant headroom maintained; gearing levels in Headroom line with targets Facility Actual Covenant (rental income movement) MetLife 4.81x 1.75x (64)% MetLife & Barings 4.62x 1.75x (59)% Additional liquidity from £
Slide 17: Operational Overview
OPERATIONAL OVERVIEW
Slide 18: Nero's Story: A Supportive Home at Pennington
CASE STUDY Nero’s Story A supportive home at Pennington Facing Pennington Hall Park, Pennington provides homes for 12 individuals with learning disabilities. It is located near local transport links and amenities. Care and support is provided to residents by Imagine, Act & Succeed whilst Partner’s F
Slide 19: Labour Government Focused on Delivering Social Housing
LABOUR GOVERNMENT FOCUSED ON DELIVERING SOCIAL HOUSING Political and Societal Demand Drivers Number of residents in Supported Living setting in the UK Increasing awareness and Forecast acknowledgement of chronic lack of ∼240K social housing +125k CAGR 9% Labour government target of delivering 1.5 mi
Slide 20: Construction Commenced on Chorley Development
CONSTRUCTION COMMENCED ON CHORLEY DEVELOPMENT Construction commenced in June on 12 new apartments for people with learning disabilities and/or mental health needs Directly commissioned, and developed in conjunction with Golden Lane Housing a leading SSH RP Enhanced energy efficiency and SOHO’s first
Slide 21: Diversified and Granular Portfolio Spread Throughout the UK
DIVERSIFIED AND GRANULAR PORTFOLIO SPREAD THROUGHOUT THE UK Diversified Lessee Base1 (by rent roll) Inclusion, 31.2% Parasol Homes, 9.6% Falcon, 9.0% My Space, 8.1% Chrysalis, 5.7% BeST, 5.3% Hilldale, 5,2% AHS, 4.8% 31.2% Blue Square, 3.9% Care Housing Association, 3.9% Highstone, 3.6% Sunnyvale, 1
Slide 22: Performance of SOHO's Lessees
PERFORMANCE OF SOHO’S LESSEES(1) Strong performance High occupancy High rent collection1 Top 10 lessees(1) represent 74.1% of Occupancy in line with expectations No material rent arrears rent roll1 of mature SSH portfolios % Rent Roll Total Units Under % Rent Collection % Occupancy Top 10 RPs1 Year
Slide 23: Strong Operational Performance
STRONG OPERATIONAL PERFORMANCE Operational performance is underpinned by the quality of services being provided to residents OPERATIONAL PERFORMANCE RESIDENT SATISFACTION SCORES Residents satisfied with their level of physical Percentage of homes with EPC rating C+ 71% 87% health CQC ratings of part
Slide 24: Regulatory Landscape and Roll Out of New Risk Sharing Clause
REGULATORY LANDSCAPE AND ROLL OUT OF NEW RISK SHARING CLAUSE Regulator Remains Active Constructive Engagement 94.5% of SOHO’s lessees are regulated by the Regulator The Regulator remains active in the RPs continue to engage constructively sector; no further judgements or with the Regulator to addres
Slide 25: Sustainability Overview
SUSTAINABILITY OVERVIEW Ee
Slide 26: The Good Economy Impact Report
THE GOOD ECONOMY IMPACT REPORT 26
Slide 27: Eco-Retrofit Pilot Programme Update
ECO-RETROFIT PILOT PROGRAMME UPDATE 12 properties included in pilot; 8 properties have received EPC of C or above 100% Residents satisfied with communication 1 property is awaiting outcome of new EPC rating and works ongoing on 3 properties Pilot project will come in under budget due to successful a
Slide 28: Outlook
OUTLOOK Delivery of long-term solution to My Space properties Complete portfolio sale and return capital to shareholders Roll-out of wider Eco-Retrofit project at a reduced cost to SOHO Increase in rental income and strong dividend cover 28
Slide 29: Appendix
APPENDIX
Slide 30: Long-Term and Fixed-Price Debt Portfolio
LONG-TERM AND FIXED-PRICE DEBT PORTFOLIO Loan Amount Lender Facility Cost Maturity Fitch Rating Commitment Drawn Loan Notes I Fixed MetLife 2028 £41.5m £41.5m A Tranche A 2.924% Loan Notes II Fixed MetLife & Barings 2031 £77.5m £77.5m A Tranche A 2.403% Loan Notes I Fixed MetLife 2033 £27.0m £27.0m
Slide 31: Key Terms
KEY TERMS UK listed REIT The Company London Stock Exchange Main Market, Premium Segment Management Triple Point Investment Management LLP as Investment Manager • the Group will only invest in social housing assets located in the United Kingdom • the Group will only invest in social housing ass
Slide 32: Glossary
GLOSSARY Approved Provider a housing association, local authority or other regulated organisation in receipt of direct payment from local government including a care provider; Board the Directors of the Company from time to time; Company Triple Point Social Housing REIT plc (company number 108140
Slide 33: Disclaimer
DISCLAIMER This presentation, including any oral presentation, any question or answer session and any written or person who does not fall within categories (A) to (E) above may not rely on or act upon the matters contained in this presentation and Triple Point (for themselves and on behalf of their
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