Shares in Region Re Ltd (ASX: RGN) are modestly higher today. This comes after the company released its half-year results for the six months ended 31 December 2025.
At the time of writing, the Region share price is up 2.59% to $2.38. Over the past 12 months, the stock is around 10% higher.
Here are the details of the results.
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Earnings and distributions move higher
Region reported Funds From Operations (FFO) of 7.9 cents per security, representing a 3.9% increase on the prior corresponding period.
Adjusted FFO (AFFO) came in at 6.9 cents per security, up 3%, reflecting additional capital deployed as vacancies were leased.
The interim distribution was declared at 6.9 cents per security. That represents a payout ratio of 87% of FFO and 100% of AFFO, in line with management's stated distribution framework.
Statutory net profit after tax (NPAT) rose sharply to $180 million, up from $81.8 million a year earlier. This increase was driven largely by higher investment property valuations rather than operating income.
Operating performance remains steady
Operationally, the portfolio delivered modest but consistent growth.
Comparable net operating income increased by 3.7% during the half, supported by supermarket sales growth of 3.1% and non-discretionary specialty sales growth of 3.3%.
Portfolio occupancy improved to 97.7%, up 20 basis points from June 2025. Specialty vacancy declined to 4.5%, down from 5.4% six months earlier.
Average specialty rent rose to $930 per square metre, representing annualised growth of 5% since December 2022. Fixed rent reviews averaged 4.3% and were applied across 96% of specialty and kiosk tenants.
During the period, 177 specialty leasing deals were completed, with average leasing spreads of 3.4% and tenant retention of 79%.
Balance sheet and capital management
Assets under management increased to $5.4 billion, up 3.9% since June, supported by valuation gains and fund growth.
Net tangible assets rose to $2.56 per security, up 3.6% over the half.
Gearing stood at 32.7%, which sits at the lower-end of Region's 30% to 40% target range. The company reported a weighted average cost of debt of 2.89%, with 100% of debt hedged or fixed.
Region also continued its on-market security buyback, purchasing 6.7 million securities at an average price of $2.39, for total consideration of $16 million.
Outlook and guidance
Management upgraded FY26 earnings guidance.
Region now expects FFO of 16 cents per security for the full year, up from prior guidance of 15.9 cents. AFFO guidance was maintained at 14.1 cents per security.
Target distribution payout ratios remain approximately 90% of FFO and 100% of AFFO.
Foolish Takeaway
Region's half-year result shows steady income growth, improving occupancy, and disciplined capital management.
The headline profit lift was largely valuation-driven, with underlying earnings growth continuing at a steady pace.
