4th Sep 2013 07:30
LONDON (Alliance News) - A&J Mucklow Group PLC Wednesday reported a marginal increase in underlying profit for the first half, as the industrial property market in the UK Midlands began to slowly pick-up.
The Midlands-based property investor reported pretax profit of GBP16.3 million for the period ended 30 June 2013, up from GBP109,000 last year. The increase resulted from a big swing in the valuation of Mucklow's investment portfolio, to an increase of GBP2.8 million in the recent period, from a negative GBP15.0 million a year before.
Underlying pre-tax profit, which excludes valuations and property sales, rose marginally to GBP13.5 million from GBP13.4 million. Gross rental income received rose to GBP20.4 million, from GBP20.2 million.
However, revenue decreased slightly to GBP21.3 million from GBP22.7 million in 2012. This year the company did not generate income received from trading properties compared with GBP1.7 million it made last year.
European Public Real Estate Association (EPRA) net asset value per share increased 2.7% to 305p per share from 297 pence per share.
Industrial property accounts for approximately two thirds of the value of Mucklow's investment portfolio. The company's average industrial rent and capital value per square foot in the Midlands at 30 June 2013 was GBP4.94 and GBP53 respectively, compared with GBP4.95 and GBP51, significantly below replacement cost.
Mucklow said its vacancy rate remained low despite it increasing slightly to 6.7% from 6.5% last year.
Mucklow completed a new GBP20 million, 10-year term loan with Lloyds TSB Bank PLC in the first half year at a fixed rate of 5.23% and renewed GBP64 million of banking facilities with HSBC Bank PLC for a further 5 years from March 2013.
Total net borrowings rose to GBP74.9 million from GBP69.0 million last year.
"There are signs that the Midlands industrial property market is slowly improving, but values still remain 30% below 2007 peak levels," Chairman Rupert Mucklow said in a statement.
"We shall continue our strategy of steadily growing income by accumulating and managing our modern portfolio of quality investment properties, which should benefit significantly from capital appreciation in the medium to long term when occupier demand and rental growth resumes."
The board approved a 3% increase in the interim dividend to 10.86 pence, from 10.55 pence last year.
Mucklow shares were trading at the open Wednesday at 445.00 pence, down 5.00p or 1.1%.
By Anthony Tshibangu; [email protected];
Copyright 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
Mucklow (A & J)