KCR Residential REIT (LON: KCR) swung to a £2.9m loss for the year to the 30th of June, as lower London property valuations outweighed a 15% rise in revenue. The AIM-quoted landlord, which owns and lets homes in London and Southampton, published its annual results today.
Revenue reached £2.17m, with core rental income up 19%, and average occupancy at its Deanery Court property rose to 83% from 67%. Cash generated by operations was £416k against an outflow of £117k a year earlier. The company called it the first positive operating cash flow in the group’s history.
The revaluation loss more than wiped out the operating gain. A £2.28m negative revaluation, against a £1.16m gain a year earlier, included about £820k from the Osprey reversionary rights, with the rest coming from yield expansion.
| Metric | FY2026 | FY2025 | Change |
|---|---|---|---|
| Revenue | £2.17m | £1.89m | +15% |
| Admin expenses | £1.41m | £1.36m | +3% |
| Operating (loss)/profit | -£2.11m | £0.99m | Swing to loss |
| (Loss)/profit before tax | -£2.90m | £0.33m | Swing to loss |
| Net cash from operations | £416k | -£117k | Swing to inflow |
| NAV per share | 23.41p | 30.36p | Down about a quarter |
Administrative costs rose only 3%, so the revaluation drove the result. Chairman James Thornton called the outcome disappointing, saying property values can fluctuate and that the group’s London properties are well located and performing well.
Net assets fell to £9.75m from £12.65m, taking net asset value (NAV) per share, the net assets attributable to each share, down to 23.41p.
The shares closed yesterday at 6.75p, about 29% of that NAV.
The group is still burning cash once financing is counted. Net cash used in operating activities was £383k, down from £800k, and cash stood at about £232k. Finance costs rose after fixed rates on its Hodge Bank debt expired.
The board expects a soft London market and slower rental growth. Thornton said that, with cost pressure, this makes the cash-positive goal harder:
This, combined with ongoing cost pressure is expected to make the objective of achieving a cash positive position more challenging.
James Thornton, Chairman
KCR made no acquisitions in the year, and the board said the group may need to raise more capital.