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(Sharecast News) - Social Housing REIT reported stronger earnings and improved dividend cover in the first half of 2025 on Wednesday, as its new investment manager Atrato pressed ahead with cost savings and portfolio optimisation.
Adjusted earnings per share rose 22% year-on-year to 3.34p in the six months ended 30 June, supported by an 18.9% increase in net rental income to 19.8m and rent collection of 91.4%, up from 87.6% at the end of 2024.
Dividend cover improved to 1.21 times from 1.01 times a year earlier, enabling a 3% increase in the interim payout to 2.81p per share.
The group said its EPRA cost ratio had fallen to 16.5% from 29.9% at the end of last year, reflecting a shift to a market capitalisation-based fee and targeted cost reductions.
Debt remained stable with 263.5m of fixed-rate borrowings at an average cost of 2.74% and a weighted maturity of 8.1 years.
Fitch reaffirmed the company's A- investment grade rating, citing resilient income streams, improving rent collection and low funding costs.
"We continue to make clear strides in improving transparency, increasing rental income and reducing costs for the benefit of our shareholders," said chair Chris Phillips.
"Since Atrato's appointment as Investment Manager in January, they have approached the business with a clear goal to improve earnings and ensure the operational performance of the portfolio remains strong.
"We were pleased to increase our dividend by 3% - the first increase since 2022.
"Our increased dividend is fully covered by earnings and has the potential for further growth."
Portfolio occupancy was stable at 86%, with all leases linked to CPI or RPI and 86% uncapped.
Properties transferred from Parasol to Westmoreland reached rent collection of 75% in line with expectations, while work to reassign assets from My Space is progressing, with the first transfers to Inclusion Group targeted for the second half.
The company said it entered the remainder of 2025 with improved earnings visibility, stronger tenant oversight and a more resilient platform.
It added that demand for specialised supported housing remained acute, with around 30,000 new homes needed over the next decade, positioning SOHO to deliver both social impact and sustainable shareholder returns.
At 1118 BST, shares in Social Housing REIT were up 2.24% at 70.75p.
Reporting by Josh White for Sharecast.com.