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Key Performance Indicators

We measure our success by tracking Key Performance Indicators (KPIs) that reflect our strategic, operational and financial progress and performance. They drive the internal management of the business, and some are used to determine how management and employees are remunerated.

Read about KPIs in the Annual Report

Total shareholder return (TSR) %

Description

TSR measures the change in our share price over the year, assuming that dividends paid are reinvested. This reflects our commitment to delivering enhanced returns for our shareholders through executing our strategy over the medium term. TSR is a key metric used in setting the long-term incentive plan remuneration for both the Executive Directors and senior managers.

Our performance

TSR was -18.3 per cent, compared with -12.4 per cent for the FTSE 350 Real Estate index. This reflects a combination of the 28.2 pence dividend (19.1 pence 2023 final dividend and 9.1 pence 2024 interim dividend) paid during the year, and a decrease in the share price from 886.4 pence at 31 December 2023 to 701.2 pence at 31 December 2024. The majority of this underperformance happened in the last quarter.

Total property return (TPR) %

Description

TPR is the ungeared combined income and capital return from our portfolio of standing investments held throughout the year. It is an important measure of the success of our strategy in terms of asset selection and management. MSCI Real Estate prepares the
calculation, as well as providing benchmark TPR data for similar properties in their wider universe. We aim to outperform the benchmark over the long term. Details on how TPR impacts short- and long-term incentives are provided on pages 123 to 131.

Our performance

The TPR of the Group’s standing assets held throughout 2024 was 5.2 per cent (2023: -0.5 per cent). The UK portfolio generated a TPR of 5.9 per cent, behind the benchmark calculated by MSCI Real Estate UK All Industrial Quarterly of 8.3 per cent. The TPR of our Continental Europe portfolio was 4.0 per cent. Benchmark data for Continental Europe will be received later in the year.

Total accounting return (TAR) %

Description

TAR is the growth in Adjusted NAV per share plus dividends paid, expressed as a percentage of Adjusted NAV per share at 31 December 2023. It measures the return on capital and is a key metric used in setting the long-term incentive plan remuneration for both the Executive Directors and senior managers.

Our performance

The TAR for the Group was 3.1 per cent (2023: -3.3 per cent). This performance reflects a combination of a flat Adjusted NAV at 907 pence and the 28.2 pence dividend
(19.1 pence 2023 final dividend and 9.1 pence 2024 interim dividend) paid during the year.

Adjusted earnings per share (EPS) pence

Description

Our Adjusted EPS reflects earnings from our operating business: rental income less operating, administrative and financing costs and tax. It is the primary determinant of the level of the annual dividend. IFRS EPS includes the impact of realised and unrealised changes in the valuation of our assets, which can often mask the underlying operating performance. The reconciliation between Basic EPS and Adjusted EPS can be found in  Note 12(i) on page 161.

Our performance

Adjusted EPS increased by 5.5 per cent to 34.5 pence during the year, reflecting higher rental income from our standing assets and new income from acquisitions and developments, partially offset by higher financing costs.

Rent roll growth £m

Description

The headline annualised rent contracted during the year less income lost from takebacks. There are two elements: to grow income from our standing assets by
reducing vacancy and increasing rents from lease renewals and rent reviews; and to generate new rent by developing buildings, either on a pre-let or speculative basis. Rent from acquisitions is not included.

Our performance

In total, we generated £56 million of net new annualised rent during the year (2023: £65 million). The decrease was driven by a lower number of pre-lets signed during the year (£20 million versus £27 million in 2023) as occupier sentiment was impacted by the macroeconomic environment and also due to a higher level of takebacks.

Loan to value (LTV) %

Description

Borrowings as a proportion of our portfolio value, including joint ventures and associates at share. The timing of investment decisions and disposals, as well as the movement in the value of our assets, may cause the LTV to fluctuate. We believe that REITs with lower through-cycle leverage offer a lower risk and less volatile investment proposition for shareholders.

Our performance

Our LTV ratio reduced to 28 per cent during 2024. With the value of our portfolio broadly unchanged during the period, this was mostly due to our £907 million equity
placing in February and a lower level of net investment due to a higher number of asset and land disposals. This gives us plenty of liquidity to fund both visible investment and potential opportunities that may arise.

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