26th Mar 2020 08:47
(Alliance News) - British Land Co PLC on Thursday said it has suspended all future dividend payments with immediate effect as the property developer looks to save cash in the face of the Covid-19 crisis.
British Land also outlined rental deferral measures for some of its retail customers. Its portfolio has a 41% exposure to the sector as of September 30.
The FTSE 100 firm, which back in January proposed a 7.9825 pence third quarter payout, said it will "revisit" its dividend policy once the clouded market outlook clears.
Earlier this week, the UK government introduced measures calling on non-essential retail stores to close in a bid to slow the spread of the deadly Covid-19 virus.
British Land explained one of its centres, Valentine in Lincoln, has closed, though all of its others have stayed open "to provide important access to essential stores such as supermarkets and pharmacies". The company added that 200 individual units in its retail sites have kept their lights on, this is just 12% of its total, however.
British Land said: "Our immediate priority is to support those customers who are being hardest hit. At sites we control, we are therefore releasing our smaller retail, food & beverage and leisure customers from their rental obligations for three months."
These measures will amount to GBP3 million in lost revenue and services charges.
The company added: "For other retail, food & beverage and leisure customers experiencing financial challenges because of Covid-19, we are prepared to defer the March quarter day rents and spread repayment over the six quarters from September 2020. On the sites we hold in joint venture or via fund structures, we are working with our partners to agree an appropriate approach."
Assuming this is extended to joint-venture and fund properties, British Land expects a hit of around GBP40 million.
It added: "We have worked consistently over several years to ensure that British Land has a strong and robust financial footing and we are now benefiting from that. We have enhanced this financial strength and flexibility by successfully extending and amending one of our unsecured revolving credit facilities at GBP450 million."
The company said it has GBP1.2 billion in available cash with no refinancing requirements until 2024.
British Land has also halted work at some developments in London.
"As of March 25, to ensure the safety and wellbeing of those working on site, work has been suspended at our major development schemes at 100 Liverpool Street and 1 Triton Square. We therefore expect delays to practical completion at these sites. There is approximately one month of work remaining at 100 Liverpool Street and approximately nine months' work at 1 Triton Square," British Land said.
Shares in the company were 4.6% lower at 344.00p each in London on Thursday morning.
By Eric Cunha; [email protected]
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