15th Nov 2024 08:38
(Alliance News) - Land Securities Group PLC on Friday said it swung to a profit in the first half of its current financial year, as it also swung to a surplus on investment property revaluations.
The London-based commercial property development and investment company said it swung to a pretax profit of GBP243 million for the six months that ended September 30, from a loss of GBP193 million the year before.
This was primarily driven by the company swinging to a net surplus of GBP84 million on the revaluation of its investment properties, from a deficit of GBP371 million last year.
Revenue fell 7.3% during the six-month period to GBP383 million from GBP412 million last year, and costs reduced 5.6% to GBP174 million from GBP184 million.
EPRA earnings declined 6.3% to GBP186 million from GBP198 million; EPRA earnings per share were down 6.6% to 25.0 pence from 26.7p, and EPRA net tangible assets on September 30 were up 1.4% to 871p from 859p.
Net assets per share on September 30 were 1.2% higher at 873p from 863p on March 31.
Land Securities declared an interim dividend of 18.6 pence per share, up 2.2% year-on-year from 18.2p.
Chief Executive Officer Mark Allan said: "Our operational performance continues, with further growth in occupancy and positive rental uplifts across our retail and London portfolio, which is translating into accelerated income growth.
"Combined with our focus on cost efficiencies, we therefore raise our outlook for EPRA earnings per share and now expect financial 2025 to be in line with last year's level, despite GBP500 million of net disposals over the past year, and for this outperformance to flow through into financial 2026.
"At the same time, property values have stabilised, with growth in rental values driving a modest increase in capital values, resulting in a positive total return on equity. We expect these trends to persist, as customer demand for our best-in-class space remains robust and investment market activity has started to pick up.
"We have continued to reposition our portfolio towards higher-return opportunities and are confident of deploying further capital towards this in the second half. Having managed our balance sheet well as markets corrected, we are now well-placed to deliver growth and attractive returns."
Land Securities upgraded its earnings per share outlook to be in line with the 50.1p reported for the last financial year.
Broker Shore Capital forecast GBP781.5 million of revenue for Land Securities' full-year results, which would represent a 5.3% fall from GBP824 million last year.
Shore Capital also forecast EPRA net tangible assets of 891p per share for March 31, 2025, up 3.7% from 859p on March 31 this year.
Shares in Land Securities were up 2.2% at 592.50 pence each in London on Friday morning.
By Emily Parsons, Alliance News reporter
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