Real Estate Investors, a West Midlands based property group, almost doubled its rental income for the half year ended June 30th, prompting the company to offer a maiden dividend of 0.5p per share.
Rental income rose 48% to £2.67m (H1 2011: £1.81m), contributing to a pre-tax profit of £0.556m compared to a loss of £1.88m the same period the previous year.
Gross property assets were up 3% to £73.5m from £71.2m at the end of 2011, while investment property assets rose 4% to £65.8m from £63.4m six months earlier. The company has net assets of £39.4m (December 31st 2011: £39m), equal to a net asset value per share of 55p (December 31st 2011: 54.6p). Cash levels fell £2.0m to £6.0m over the year.
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In a statement the firm commented: "Contracted rental income has risen to £6.3m. Valuations across the property market remain under pressure. However, through careful asset management and improving rental income, we are able to combat these pressures and have seen a modest increase in the value of the portfolio, with further growth potential.
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"Commercial property activity in the West Midlands doubled in Q2 2012 to £317 million from £167 million in Q1 2012. This is due to improving lending conditions and growing appetite for regional assets that provide significantly better yields and capital growth potential than in London, which has been the focus of the market for some time.
"The existing portfolio remains stable and we will seek to add to this, and take advantage of our market reputation, and preferred buyer status, but only when we identify opportunities that meet our criteria. We believe that these are most likely to be derived from institutional funds wishing to exit non criteria assets and distressed sales from banks and receivers."
The share price rose 8.97% to 42.50p by 12:47.
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