Supermarket Income REIT has published its financial results for the year ending 30 June 2025, following its internalisation which is expected to deliver £4 million in cost savings and strengthen alignment between the Company, its management team, and shareholders.

The REIT established a £403 million joint venture with funds managed by Blue Owl Capital, representing a 3% premium to the 31 December 2024 book value. With a 50% stake in the JV, it raised approximately £200 million in net proceeds to invest in a pipeline of opportunities. Committed to maintaining one of the lowest cost structures in the sector, the Company is targeting an EPRA cost ratio below 9%. It also completed its debut sterling bond issuance, locking in £250 million of debt at a 5.125% coupon for six years.

“This has been a transformational year for Supermarket Income REIT which has positioned the Company to return to growth,” says CEO, Robert Abraham. “The team has delivered shareholder value through numerous key strategic milestones most notably the internalisation … We have proactively sought to deliver further shareholder value through establishing a £403 million JV, issuing our debut £250 million sterling bond, demonstrating the affordability of rents and validating asset valuations, whilst broadening our investor base through our secondary listing on the JSE.”

During the period, the Company acquired £81.2 million of assets at an average yield of 7.3%, representing a 2.3% spread to the incremental cost of debt while disposing of £466.8 million of assets, highlighting strong demand for omnichannel stores.

Its active capital recycling has resulted in a marginal decline in EPRA earnings per share of 2%, which reflects temporary cash drags as it continues to deploy the net proceeds from the JV.

The non-discretionary grocery market continues to demonstrate growth and resilience, it says, with the UK grocery market having shown consistent growth with sales up 5.4% year-on-year in July 2025 – and forecast to grow to £259 billion in 2025.

Tesco and Sainsbury’s increased sales and market share during the year with a combined 43% market share and a total online market share of 12% (and growing).

French grocery market sales are forecast to reach €329 billion by 2029, representing 3% annual growth. Carrefour has a 21.5% market share in France, an increase of 2.2 percentage points since June 2024 with the country’s online grocery shopping one of the fastest growing channels, experiencing 88% growth between 2018 and 2025 and accounting for approximately 10% of the market.

“The investment case for supermarket real estate is as compelling as ever and our relationship led model combined with sector specialism allow us to unlock attractive opportunities for shareholders. Our portfolio of 82[18] high-quality food stores let to operators of significant scale, under triple net leases with contractual inflation linked uplifts, enables us to deliver an efficient platform with a falling cost ratio,” notes Abraham.

The Company holds approximately £450 million in liquidity, including cash and undrawn committed facilities. Its Fitch BBB+ investment grade rating remains reaffirmed, ensuring access to attractively priced, long-term debt.

Post balance sheet, it completed a debut sterling bond issuance of £250 million, which was oversubscribed, with a six-year term and a fixed coupon of 5.125%.

Its loan-to-value (LTV) ratio stood at 31% as of 30 June 2025 (compared to 37% in FY2024 and currently 34%) with the REIT having raised its FY2026 target dividend to a minimum of 6.18 pence per share.

Supermarket Income REIT announced its secondary listing on the JSE in early December 2024.