Landsec "Cash flow trumps geopolitics" (Buy) Gauge

研报英文原文证据摘录

Landsec "Cash flow trumps geopolitics" (Buy) Gauge

viability. In our view, the current political environment combined with elevated cost 03/28E 56.05 55.71 -1 55.38

pressures and higher return requirements following the Iran conflict – makes 03/29E 58.52 59.20 1 57.16

progression less likely than not. The implications for earnings and our price target are

negligible. The schemes were not guided to contribute to FY30 EPS and, even under our Zachary Gauge

Analystprior assumptions, were broadly neutral relative to Landsec’s cost of capital. Although

zachary.gauge@ubs.com

not our base case at this stage, we flag an upside risk that share buy backs could be +44-20-7901 5534

utilized for excess capital should the residential schemes not move forward.

Charles Boissier, CFA

AnalystUpdated capital growth estimates

charles.boissier@ubs.com

While the occupational market remains in relatively healthy shape, we expect some +44-20-7568 4415

modest negative pressure on yields from both domestic and geopolitical uncertainty,

Nadir Rahman

reflected in the ~70bps rise in gilt yields since the start of the year. As a result, we have

Analyst

revised our capital growth assumptions lower. Based on the standing portfolio, we now nadir.rahman@ubs.com

forecast capital growth of 0.2% in FY27 (vs. 1.2% previously) and 0.7% in FY28 (vs. +44-20-7567 1750

1.5% previously). This is partially offset by higher development profit assumptions from

the increased ERV at Thirty High. We also move our disposal below book value for low/

no yield development sites back 6-months to align with our disposals timeline - now

impacting 2H27 and 1H28.

LAND trades at a spot 29% discount to EPRA NTA

Our model is economic profit based and points to a 22% discount t+1. With this update