27th Jun 2014 07:57
LONDON (Alliance News) - Secure Property Development & Investment PLC Friday said it swung to a loss in 2013, as the political crisis in Ukraine and delays in completing the acquisition of income-generating buildings took its toll.
Ukraine is in crisis after Russia moved to assert control over the Crimea in the wake of the ousting of former Ukraine president and Moscow ally Viktor Yanukovych. The country has a fledgling new leadership struggling to assert control over the eastern part of the country on the border with Russia.
SPDI, which invests in real estate in Eastern Europe including Ukraine and Romania, posted a pretax loss of USD4,559 for 2013, compared with a USD145,395 profit in 2012.
The company said it was frustrated by delays arising from what remains a "very cautious and inefficient business environment" in Ukraine. However, it said the loss during the year came largely due to later-than-expected acquisitions of income-generating buildings in Romania, which if settled earlier would have increased its bottom-line result considerably.
SPDI said that, in the Ukraine, despite high level of interest in income-producing assets from high net worth individuals, the deterioration of the political situation led to many deals being put on hold.
At an operating level, the company said it had some success, with its Terminal Brovary supermarket and entertaining centre in Ukraine now completely occupied following the signing of new leases. SPDI said net rental income at the site increased 33% compared with the previous year.
Overall, the group's net asset value increased to USD52.2 million from USD33.9 million a year earlier.
Despite its problems, the company remained upbeat and said 2014 will be seen as a turning point in its "evolution".
"We have worked through bankruptcy in 2010, a loan default in 2011 and have managed to stabilise the company both financially and operationally during the economic and financial sector crisis between 2012 and 2013, and overall Eurozone instability," Chief Executive Lambros Anagnostopoulos said in a statement.
"We now have a strategy focused on growth and diversification, a committed group of shareholders and a driven management team, so we are confident that we will have a successful year," he added.
SPDI shares were untraded Friday morning; they were last quoted at 56.00 pence.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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