LONDON (dpa-AFX) - Grainger plc (GRI.L) announced the company plans to divest of two divisions: Retirement Solutions (Equity Release) and Germany. Post-disposals, overheads will reduce by approximately 10%.
Separately, Grainger said it plans to reduce overheads by transitioning to a simpler, streamlined structure. An operational review is underway, which the Group will report at first half results in May.
Grainger also plans to: exit non-core development assets; prioritise direct investment, with no new funds, and no more focus on fee generation; reduce cost of financing; targeting 4% cost of debt; and concentrate resources on two core assets: regulated tenancies and PRS.
Helen Gordon, CEO of Grainger plc, said: 'It is clear that swift and decisive action is required to capitalise on the compelling PRS market opportunity and to enable Grainger to realise its potential of being the UK's leading private landlord. We will transition to one highly focused business that will deliver improved and sustainable, rental asset led shareholder returns.'
Looking ahead to 2020, the Group's PRS-led strategic targets are: invest over 850 million pounds into PRS assets to drive rental income growth; net rents and income to more than cover overheads, expenses and financing costs; net rental income to exceed profit from sales; and dividend will increase, reflecting the greater proportion of rental income.
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