5th Jun 2020 08:27
(Alliance News) - Workspace Group PLC on Friday said profit almost halved in its most recent financial year on property revaluation, which swung to a deficit from a surplus.
The office space provider reported a GBP72.5 million profit for its year ended March 31, a steep 47% drop from GBP137.3 million the year before. This results from a negative movement in Workspace's property revaluation to a GBP7.5 million deficit from a GBP60.8 million surplus.
More positively, revenue increased 8.0% to GP161.4 million from GBP149.4 million and trading profit after interest increased 12% to GBP81.0 million as net rental income rose 10% to GP122.0 million. Trading profit after interest is calculated by deducting underlying administrative expenses, share based costs, and net finance costs from net rental income.
Workspace declared a final 24.49 pence per share dividend, taking the total dividend per share for its financial year up 10% to 36.16p from GBP32.87p.
Chief Executive Graham Clemett noted the "dramatic impact" of Covid-19 and said: "As a company, we felt it was important to support customers where we could and hope that the 50% rent reduction and deferral agreements we have offered to the majority of our customers have gone some way to lessen the burden of this crisis. We have been readying our business centres for the increasing return of customers, putting in place extensive measures to enable social distancing and promote good hygiene. Freehold ownership of our properties means we can quickly adapt them to cater for these new requirements."
Clemett highlighted Workspace's robust balance sheet and "prudent funding liquidity", as well as its "substantial headroom" on its covenants.
"Looking forward, we will undoubtedly see subdued levels of operational performance in the short term with a reduction in rental income. However, we expect that the structural shift in the office market towards flexibility will now accelerate more broadly. We believe that, with our well established flexible offer and the quality of our space and services, Workspace is ideally positioned to benefit as London recovers from the impact of the Covid-19 pandemic," Clemett added.
Workspace shares were trading 2.2% higher in London on Friday morning at 807.00 pence each.
By Anna Farley; [email protected]
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