Panther Securities

Panther Securities Dividend Analysis and Summary

• Declared: Final dividend of 6p per share for FY2025.
• Ex-dividend date: 25/06/2026.
• Record date: 26/06/2026.
• Payment date: 15/07/2026.
• Total FY2025 distributions: 22p per share (ordinary 12p: 6p interim + 6p final; plus a 10p special paid on 29 Oct 2025).
• Share count: c. 17.36m weighted average shares; 393k held in treasury (50k added Feb 2026), modestly reducing future cash outflow.

• Earnings cover: FY2025 EPS 24.5p.
  • Ordinary dividend (12p) covered ~2.0x.
  • Total with special (22p) covered ~1.1x—special appears opportunistic, not recurring.
• Cash flow: Net cash from operations (after interest and tax) £2.68m vs FY2025 cash dividends paid £3.82m (included the 10p special). Ordinary outflow (~£2.08m for two 6p payments) was covered ~1.3x; the special relied on asset recycling and balance sheet flexibility.
• Balance sheet and covenants: Loan-to-value 35%; interest cover (lenders’ basis) 362%; finance cost rate down to 5.3%. Significant covenant headroom (c. 36% valuation fall or 50% income drop required to breach).
• Interest rate protection: Swaps fixing £60m at all-in ~5.70% (3.40% swap + margin) and 4.31% (2.01% swap + margin) provide near-term cost visibility.

• Ordinary dividend held at 12p in recent years (6p interim + 6p final), with intermittent specials (FY2025: 10p), suggesting a stable core payout supplemented by episodic returns of capital.
• FY2025 total dividend rose to 22p from 12p in FY2024, driven by the special; underlying ordinary appears steady rather than growing.

• Operating backdrop: Rents receivable grew to £14.85m; bad debts fell; revaluation gains of £3.21m. Profit after tax £4.25m (down y/y mainly due to derivative valuation swing).
• Cash and liquidity: Year-end cash £5.93m; undrawn RCF capacity £13m.
• Post year-end cash events: £2.06m cash received from swap restructure (Mar 2026); £1.945m loan repayment using disposal proceeds (redrawable); further £284k disposal proceeds (Apr 2026). A contracted deferred receipt of £500k is due in June 2026 from the Peterborough sale.
• Assessment: The ordinary dividend looks well supported by recurring rental income, strong covenant headroom and interest hedging. The special dividend appears funded by portfolio recycling and financial flexibility, and should be viewed as non-recurring.

• Swap restructure (Mar 2026): £35m swap now ends Sep 2031 (from 2038) with £2.06m cash received. Near-term positive for cash; slightly shorter duration of rate protection in the 2030s.
• Share buyback: 50,000 shares purchased into treasury (Feb 2026), marginally lowering ongoing dividend outflow per share.
• Asset recycling: Ongoing disposals and selective acquisitions signal a continued policy of funding returns and de-gearing via portfolio optimisation.
• Board changes: Two long-serving NEDs retiring June 2026; governance transition unlikely to alter policy near term but worth monitoring.

• Sector mix: Retail exposure c. 60–65% of income. Management emphasises neighbourhood parades (more resilient), but retail remains structurally challenged.
• Macro headwinds: Persistent inflation and slower growth; however, interest costs are largely hedged.
• Cash coverage: Ordinary dividend covered by cash generation; specials depend on disposals/deferred receipts—less predictable.
• Derivative mark-to-market: Non-cash volatility can swing reported earnings but does not directly affect dividend capacity; still a headline risk.