Press releases
Interim results for the six months ended 30 September 2007
15/11/2007
Financial Highlights:
· Net Asset Value 1 per share unchanged at 1682 pence (Q2 down 3%)
- EPRA Net Assets1 £8.7 billion
- IFRS Net Assets £8.6 billion
- Properties owned or managed £20 billion
· “Triple Net Asset Value” per share 1745 pence, up 4% (Q2 down 3%)
- Adjusts debt and derivatives to market value, and deducts deferred tax
· Underlying pre-tax profit 2 £143 million, up 10% (Q2 £67 million up 18%)
- IFRS loss on ordinary activities before tax £35 million
· Underlying earnings per share 2 26 pence, up 30% (Q2 12 pence up 33%)
- IFRS earnings per share nil
- Dividend 8.75 pence per share for the quarter to September 2007 (payable February 2008) making 17.5pence for the six months, more than treble that of last year (and consistent with 35 pence full year target)
- £250 million share buyback programme announced and underway, £125 million completed up to 30 September
· Exceptional balance sheet resilience
- Portfolio 99% let3 with 14.4 years average lease length
- Debt 100% fixed rate at 5.3% average cost and average maturity of 12.7 years
· Portfolio valuation decrease of 0.5% for the six months (Q2 1.9% decrease)
- Capital return4 -0.5%, ahead of IPD Benchmark at -0.9%, due to outperformance on rental value growth (ERV)
- Like for like rental value growth of 4.2% versus IPD 2.4%
- Outward yield shift of 21bps overall (Offices 25bps, Retail 20bps)
- Valuations decreased principally within the Retail portfolio, down 2.9%;
Offices (including developments) show 3.6% increase with ERV growth offsetting outward yield shift
Activist strategy progressing well:
- £1.9 billion (gross) disposals since March 2007, overall 3% above valuation
- Good occupancy demand, driving rents forward in both Office and Retail sectors
- Development programme on schedule
- Over 710,000 sq ft Office lettings and 740,000 sq ft Retail lettings since March 2007, including development pre-lets, capturing occupier demand and lowering risk
1 EPRA (European Public Real Estate Association) basis – Note 1 to the accounts
2 see Note 1
3 includes accommodation subject to asset management initiatives and under offer
4 calculated by IPD for our UK assets on average capital employed and excluding capitalised interest
Chris Gibson-Smith, Chairman comments:
The interim results are ahead on underlying profit and rents and unchanged from the start of our financial year at the Net Asset Value per share level. The property market correction, currently ongoing, has led to valuation mark-downs in Q2 offsetting progress in Q1. British Land is not immune from the wider market but we are facing those difficult conditions from an advantaged position. Our strategy is settled and clear, our buildings appeal to customers and our balance sheet is robust.
Stephen Hester , Chief Executive Officer comments:
We entered the property market correction with significant positives – a strong balance sheet, 100% fixed interest rates, and among the highest occupancy rates and lease lengths in our industry. Customer focus and our activist strategy are helping us outperform at the rental level and we firmly believe that an investment in British Land offers clear value. However, more than one quarter is likely to be needed to complete the market correction which may well be uneven in timing and across participants.
British Land contacts:
|
Laura De Vere |
- Media |
020 7467 2920 / 07739 292920 |
|
|
Amanda Jones |
- Investors |
020 7467 2946 / 07921 884017 |
Finsbury:
|
Faeth Birch |
020 7251 3801 / 07768 943171 |
||
|
Ed Simpkins |
020 7251 3801 / 07947 740551 |