Warehousing giant Segro has reported a double-digit jump in profit driven by demand for data centres and improving investment market conditions.
Adjusted profit before tax at the FTSE-100 real estate investment trust (REIT) grew 14.9 per cent in the year ended December 31 to £470m.
Adjusted earnings per share rose 5.5 per cent to 34.5p, while the value of its portfolio grew 1.1 per cent to £17.7bn.
The company generated £91m of new rent, including a 43 per cent uplift from UK rent reviews and renewals.
Like-for-like rental growth at the REIT was up 5.5 per cent, driving a seven per cent increase in net rental income to £628m.
David Sleath, Chief Executive of SEGRO, said: “We have created the largest data centre hub in Europe and are increasingly excited about the exceptional value creation opportunity from our pipeline of 2.3GW European data centre sites in core Availability Zones [clusters of data centers near densely populated financial hubs].
“We plan to pursue the most attractive risk-adjusted returns on each opportunity, including initially working with partners to develop fully-fitted data centres.”
“Having seen conversations with occupiers pick up pace in recent weeks, we expect leasing and pre-letting activity to increase.”
Segro expected future demand to be driven by “powerful, enduring structural trends: data and digitalisation, urbanisation, supply chain optimisation and sustainability.”
“Our business is therefore well-placed for further attractive, compounding growth in earnings and dividends in the years ahead, with significant additional value upside from our data centre pipeline.”
Last November, Segro unsuccessfully attempted to take over rival firm Tritax – losing out to Canadian investment manager Brookfield – but bought about a third of Tritax Eurobox’s assets for 470m euros (£389m).
Despite falling more than 11 per cent in the past year, Segro’s share price has had a strong start to 2025 with a six per cent uplift since January 1.