THE BRITISH LAND COMPANY PLC FULL YEAR RESULTS
Management Actions Drive Continued Outperformance
Good results in challenging markets
- Underlying PBT up 5.1% to £269 million reflecting £28 million (5.4%) growth in net rental income
- EPRA NAV up 4.9% to 595 pence
- 1.5% increase in Q4 dividend to 6.6 pence; full year dividend of 26.1 pence
- Quarterly dividend for 2012/13 of 6.6 pence; making a total of 26.4 pence
- Total Accounting Return of 9.5%
Portfolio structure, development and asset management driving 75% of the valuation uplift
- Portfolio valuation up 2.6%: capital returns at 3% outperforming IPD by 250 bps
- 2.1% growth in portfolio estimated rental value (ERV), outperforming IPD by 160 bps
- Total property return of 8.3% above IPD by 200 bps
- Both Retail and Offices outperformed IPD Total Return benchmarks by 110 bps and 410 bps
Focus on prime, well located properties securing and growing rental income
- 5.0 million sq ft of leasing activity generating £10.0 million pa of new rent (excluding pre-lets)
- 1.0 million sq ft lettings and renewals in retail, 6.9% above ERV
- 1.0 million sq ft of lettings and lease extensions in offices, 3.3% above ERV
- Increase in portfolio occupancy of 20 bps to 98.0%; UK retail 98.3% and offices 98.0%
- Proportion of rent expiring in the next 3 years reduced to 7.6% from 10.4% a year ago
Benefiting from early commitment to London development; increasing retail development pipeline
- 50% of office developments under construction now pre-let to UBS, Aon and Debenhams - securing £34 million of annual income
- £167 million of valuation uplift from office developments to date; further £192 million to come
- 347,000 sq ft of UK retail developments committed in the year; already 72% let/under offer
- Further 960,000 sq ft of retail developments with planning secured or pending
Investing in quality assets with secure and growing income; increased recycling ahead of valuation
- £371m of acquisitions made at 6.9% net initial yield, adding £21 million of annual rent
- £100m of disposals of lower growth assets at 1.6% above March 2011 valuation
Strengthened financial position through significant level of financing activity
- £2.0 billion (British Land share £1.4 billion) of financing agreed since April 2011
- Operational and financial flexibility maintained with diversified funding and spread of maturities
- LTV at 45.3% (proportionally consolidated) with 2.2 times interest cover; Group LTV at 29.1%
Chris Grigg, Chief Executive said: "These are good results, and that's in a tougher environment. Our profits, valuation and NAV are all up. We outperformed the broader UK commercial property market on almost all key measures and our balance sheet is strong. I am particularly pleased by our high level of leasing activity and development progress over the period. Our results also show we are defensively positioned in today's more challenging markets, but also well placed to continue to outperform in the future, as a result of the decisions we have taken."
