27th May 2020 08:49
(Alliance News) - British Land Co PLC on Wednesday reported a widened loss for financial 2020 but said it remains "encouraged" by its current negotiations and financial position amid the Covid-19 pandemic.
The stock was trading 5.4% higher at 400.50 each on Wednesday morning in London.
For its financial year ended March 31, the FTSE 100-listed real estate investment trust posted revenue of GBP613 million, down 32% from GBP904 million reported for financial 2019. Pretax loss was GBP1.12 billion, widened significantly from a loss of GBP319 million. This was after recording a GBP1.1 billion loss from the revaluation of properties, compared to a loss of GBP620 million the prior year.
Underlying profit dropped 10% to GBP306 million from GBP340 million. This figure was broadly in line with analyst expectations of GBP305 million. Underlying profit adjusts for property revaluations, gains and losses on investment and trading property disposals, and changes in the fair value of financial instruments and associated close-out costs.
British Land's EPRA net asset value per share fell 15% to 774 pence at the end of March from 905p a year ago as its portfolio valuation shrank by 10% to GBP11.16 billion. The portfolio valuation fall was made up of a 26% decline in retail properties, due to structural challenges exacerbated by the early effects of Covid-19, while office property values saw an uplift of 2.3%.
The investor confirmed that dividends have been temporarily suspended, meaning the full-year payout was down 48% to 15.97p. Dividends will resume at an appropriate level as soon as there is "sufficient clarity of outlook", it explained.
"For this we will need to see a significant improvement in rent collection and have more visibility on the post lockdown productivity of our assets, principally how quickly retail customers and office workers return," British Land said.
It added that 68% of March rent has been collected, equating to 91% when adjusting for rent deferrals.
Chief Executive Chris Grigg said: "Near term, we are expecting the offices market to be more cautious, but we continue to conduct virtual viewings and are encouraged by negotiations we are having. In Retail, given current valuations and the lack of liquidity in the investment market, our focus is on delivering value though asset management, working to keep our places full and exploiting demand for assets which support an online offer. Our financial position is robust with debt low, significant covenant headroom and access to GBP1.3 billion of undrawn facilities and cash so we are well placed to weather today's challenges and succeed in the long term."
The property firm highlighted that it has significant headroom to its debt covenants, with the group able to withstand a further valuation fall of 45% before any mitigating actions.
As at the end of March,British Land had GBP269 million in cash.
By Ife Taiwo; [email protected]
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