13th Aug 2014 08:16
LONDON (Alliance News) - Retail property specialists Capital & Regional PLC Wednesday reported an increase in pretax profit for the first half, as its share of profit from joint ventures increased considerably.
The company, which owns Waterside shopping centre in Lincoln, posted pretax profit of GBP10.5 million for the six months ended June 30, up from GBP3.1 million a year earlier. Capital & Regional said its share of profit from associates and joint ventures rose significantly to GBP12.6 million from GBP1.4 million a year earlier.
Revenue, however, dipped slightly to GBP8.6 million from GBP8.9 million.
During the period the company increased its holdings in the Mall Fund to 91.8% from 29.26% by snapping up Aviva PLC's 52.04% stake and Karoo investment Fund's 10.52% stake in a deal worth GBP213 million. The Mall Fund consists of shopping centres in Blackburn, Luton and Wood Green, London.
The acquisition forms the cornerstone of the group's strategy to position itself as the UK's leading dominant community shopping centre owner. The group also said the deal allows it to control its largest investment and "generate increased cash returns on behalf of its shareholders from the delivery of attractive value enhancing asset management and development opportunities across its portfolio."
At an operating level, in Blackburn a 10-year lease renewal was completed with Boots for the retailers' 20,000 square foot unit, while a 19,000 square foot unit has been let to budget retailer B&M European Value Retail PLC.
Meanwhile, at Camberley, Select and Deichmann have both signed a 10-year lease on units of 5,000 square feet and 4,500 square feet, respectively.
Overall, at the period-end the UK shopping centre portfolio was valued at GBP881.2 million. Occupancy for the portfolio also increased to 94.5% from 93.5%.
In Germany, the company's joint venture with Ares Management sold its property at Lübeck for EUR47.9 million. It also disposed of a small development property at Kreuztal for EUR1.3 million.
Looking ahead the company said its Mall Fund acquisition enables it to accelerate the execution of an asset management plan at a time when retailer interest in both upsizing and taking new space in well-located town centre schemes is increasing.
"The initiatives generate very attractive returns and are central to the investment case presented to shareholders at the time of the capital raise," Chief Executive Hugh Scott-Barrett said in a statement. "The continuing strength of investment markets is also expected to provide support for a further uplift in valuations during the rest of this year."
On the back of its performance the company increased its interim dividend to 0.35 pence from 0.25 pence a year earlier.
Capital & Regional shares were quoted down 0.3% at 46.88 pence Wednesday morning.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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