Half Year 2025 CLS Holdings PLC Earnings Call Transcript
Key Points
- CLS Holdings PLC (FRA:838) reported strong leasing momentum with GBP7.5 million of annual rent signed, marking a 17% increase compared to the same period last year.
- The company has successfully completed or agreed over 90% of its refinancing due in 2025, reducing refinancing risk.
- CLS Holdings PLC has executed sales of GBP143 million this year, contributing to a reduction in loan-to-value (LTV) and freeing up capital for investments.
- The company is investing in its portfolio to unlock value, with significant progress in projects like Citadel, the Brix, and the Yellow.
- Over 60% of the portfolio is now index-linked, providing support to net rental income and driving rental growth.
- Vacancy rates increased to 15% by June 30, 2025, due to expiries in the UK and Germany, impacting earnings.
- Valuations in the first six months were down 1.6% in local currency, driven by yield expansion and increased vacancy.
- Earnings per share (EPS) decreased by 16.7% to 4.0p per share compared to the previous year.
- The company's disposal program, while reducing LTV, is expected to be slightly earnings dilutive in the short term.
- The investment market in Germany remains challenging, with limited meaningful improvements despite increased leasing activity.
Good morning and welcome to CLS Holdings PLC half year results presentation 2025. Let me start with an introduction. I am Fredrik Widlund, Chief Executive, and next to me is our CFO, Andrew Kirkman. This morning we will present the results for the first six months that we have announced this morning. Before we go into more detail later in the presentation, I would like to set the scene by highlighting our current main priorities and how we are delivering against them.
First, increasing letting activity to reduce vacancy and improve earnings. We've had positive leasing momentum in all countries since the beginning of the year, and this trend is accelerating. As the vehicle reduces, earnings should start growing again over time.
Second, executing sales of GBP400 million to reduce LTV to our target range of 35% to 45%. We have set out a target to sell GBP400 million of properties to reduce loan to value and recycle capital for investments. We have completed on over half of the sales so far, including
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