Student Accommodation Research: Growth in PBSA Changing Market Fundamentals
8th Nov 2019
Empiric Student Property has reported revenue growth of 14% year-on-year for the six months ending 30 June 2019 to £35.7 million.
The company's gross margin also improved to 68.5% (2018: 62.3%) and is on track to meet the full-year target of greater than 67%.
Profit before tax rose 33% to £28.8 million, with earnings per share increasing by a similar amount to 4.78p (2018: 3.60p).
The company has continued its strategy from being a real estate owner to a fully integrated operational business, with the remaining 57 operating assets brought in-house at the end of March 2019. This ensures that the company has complete control of its 91 operating assets.
Empiric reported a reduction in the average cost per bed of 11% compared to the first half of 2018, with total administration costs of £5.0 million, in line with the company's target of £10 million.
At the end of June, the company recorded an occupancy rate of 97% for the 2018-19 academic year and bookings of 85% for 2019-20.
Meanwhile, the Empiric property portfolio was valued at £1,001 million as of 30 June, representing a like-for-like increase of 3.1%.
Commenting on the results, Time Attlee, Chief Executive Officer, said: "We have made good progress over the last six months and have delivered the most significant part of our operational transformation, from being a real estate owner to a fully integrated operational business with customer service at its heart."
"We continue to develop a dynamic and well-targeted digital marketing platform, and bookings for the 2019/20 academic year are progressing well. We are continuing to improve our financial and operational performance, which remains in line with market guidance, and we are confident in the outlook for our business."
At the end of the reported period, Empiric has a pipeline of six developments located in Leicester, Edinburgh, Falmouth, Southampton, Canterbury and Bristol that will add a further 927 beds to its portfolio.
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