28th May 2015 08:55
LONDON (Alliance News) - Helical Bar PLC Thursday hailed its strategy of investing and developing in London without ignoring opportunities to invest in other regions of the UK, as the property investment and development company reported an increase in net asset value in its last financial year.
Helical Bar said its net asset value, on the European Public Real Estate Association basis, increased to 385 pence at the end of March from 313p a year earlier, citing growth in rents and the surpluses on the investment portfolio. Pretax profit amounted to GBP87.4 million in the year ended March 31, which the group said was the second highest recorded in its history after the prior year's GBP101.7 million.
The company reported a 27% increase in the valuation of its London investment portfolio, meaning it is now valued at GBP370 million and equivalent to 47% of the entire investment portfolio.
Operating profit was up to GBP122.4 million from GBP106.7 million, as higher net rental income and net gains on sale and revaluation of investment properties more than offset lower development property profit. Net finance costs, which increased to GBP21.2 million from GBP12.7 million, rose due to falls in expected future interest rates leading to charges from valuing derivatives financial instruments and due to a GBP100 million convertible bond issued in June 2014.
"We expect our London portfolio to continue to provide significant surpluses over the next few years as rental levels grow, and we complete and let our development schemes. In the regions, we have completed our rotation out of secondary shopping centres and into high yielding distribution warehouses, regional offices and out-of-town retail parks," Chief Executive Michael Slade said in a statement.
"We have seen good demand from occupiers for the assets in our portfolio and strong interest in those types of assets from institutions. This is leading to a rise in both rental and capital values as the UK economy strengthens outside London," Slade said.
The CEO said the company can "look forward with confidence" following the UK General Election in May, when the Conservative Party secured a majority victory that took many by surprise, pointing out that a "more stable domestic political situation" should aid economic growth.
Helical Bar increased its dividend for the year to 7.25p from 6.75p.
Shares in the company were up 1.0% at 414.00 pence on Thursday morning.
By Samuel Agini; [email protected]; @samuelagini
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