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First Property swings to interim loss but optimistic on Warsaw demand

23rd Nov 2023 13:10

(Alliance News) - First Property Group PLC on Thursday reported it swung to an interim loss as it made no profit from the sale of investment properties, as it did a year prior.

The London-based property fund manager and investor said in the six months to September 30, it swung to a pretax loss of GBP652,000 from a profit of GBP2.4 million a year prior.

Revenue declined 5.3% to GBP4.0 million from GBP4.2 million, while cost of sales increased 3.9% to GBP1.8 million from GBP1.7 million.

Notably, the company incurred no profit from the sale of investment properties, compared to GBP1.1 million a year prior.

First Property declared no interim dividend, compared to a dividend of 0.25 pence per share a year ago.

Looking ahead, the company said: "Investment demand for commercial property remains weak but occupational demand remains steady. The development of new property is at a cyclical low."

It added that markets have been challenging due to a rapid rise in interest rates and a collapse in demand for commercial property.

However, it noted occupational demand for vacant space in office blocks in Poland, notably in Warsaw and Gdynia.

Chief Executive Ben Habib said: "As we lease up this space, we will start again to generate good levels of cash, as we have always historically done. In the meantime, our cash balance is good, with over GBP6 million on the balance sheet, giving us the firepower we need to fitout the space as it is leased."

First Property shares rose 3.0% to 17.00 pence each on Thursday afternoon in London.

By Tom Budszus, Alliance News slot editor

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