UPDC REIT Records N1 Billion Rental Income in Q3 2023

UPDC Real Estate Investment Trust (UPDC REIT), one of the leading real estate companies listed on the Nigerian Exchange Group (NGX), reported a rental income of N1 billion in the third quarter of 2023.

This represents an increase of 11.5% from the N897 million recorded in the same period in 2022.

The company’s revenue for the quarter under review rose by 19.7% to N1.4 billion, up from N1.17 billion in Q3 2022. The revenue comprises income from deposits with banks, fair value gains on investment properties, and rental income from its portfolio of properties.

UPDC REIT is a real estate investment trust that acquires, develops, and leases out investment properties in Nigeria.

As of September 30, 2023, the company had an investment property portfolio valued at N23 billion, up from N22.4 billion as of December 31, 2022. The portfolio consists of residential, commercial, and hospitality properties located in Lagos, Abuja, and Port Harcourt.

The company’s N1 billion rental income implies a rental yield of 4.3% based on the investment property value of N23 billion. When annualized, the rental yield is around 5.6%. This is lower than the average rental yield in Nigeria, which ranges between 6-8%, and also lower than the inflation rate, which stood at 26% as of September 2023.

The company’s operating expenses increased by 16.3% to N488.9 million in Q3 2023, up from N420.3 million in Q3 2022. The increase was mainly due to higher administrative and management fees. However, the company’s pre-tax profit increased by 22.3% to N921 million in Q3 2023, up from N753.1 million in Q3 2022. The company’s earnings per share also increased by 25% to 35 kobo in Q3 2023, up from 28 kobo in Q3 2022.

The company declared a dividend of 19 kobo per share in August 2023 for its shareholders, which it paid in September 2023. The company’s current share price is N3.45 per share and has gained 16.95% in the last year. The company’s market capitalization is N9.9 billion as of November 8, 2023.

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