Become a Member

Track your favourite stocks
Create & monitor portfolios
Daily portfolio value

Company	Chg	Chg %
Quickpicks
£	%
Add shares to your quickpicks to display them here!

Final Results - Part 2

14th May 2014 07:00

RNS Number : 0383H

British Land Co PLC

14 May 2014

Consolidated Income Statement
for the year ended 31 March 2014
				2014					2013

				Underlying		Capital			Underlying		Capital
				pre-tax*	and other		Total		pre-tax*	and other		Total
			Note	£m		£m	£m		£m		£m	£m



Gross rental and related income			3	384		-	384		329		-	329

Net rental and related income			3	313		-	313		281		-	281

Fees and other income			4	15		-	15		15		-	15

Joint ventures and funds (see also below)				124		253	377		130		(63)	67

Administrative expenses				(72)		-	(72)		(72)		-	(72)

Net valuation movement (includes result on disposals)			5	-		615	615		-		88	88

Financing costs		- financing income	6	9		3	12		21		2	23
		- financing charges	6	(90)		(60)	(150)		(101)		(41)	(142)

				(81)		(57)	(138)		(80)		(39)	(119)


Profit (loss) on ordinary activities before taxation				299		811	1,110		274		(14)	260


Taxation		- current tax income	7			3	3				8	8
		- deferred tax income	7			3	3				16	16

						6	6				24	24

Profit for the year after taxation							1,116					284

Attributable to non- controlling interests				2		8	10		-		-	-
	Attributable to shareholders of the Company			297		809	1,106		274		10	284

Earnings per share		- basic	2				110.7	p				31.7	p
		- diluted	2				110.2	p				31.5	p


* As defined in note 2

All results derive from continuing operations.
				2014					2013

				Underlying		Capital			Underlying		Capital
				pre-tax*	and other		Total		pre-tax*	and other		Total
			Note	£m		£m	£m		£m		£m	£m


	Share of results of joint ventures and funds
	Underlying profit before taxation			124		-	124		130		-	130
	Net valuation movement (includes result on disposals)			-		258	258		-		(62)	(62)
	Non-recurring items			-		-	-		-		(4)	(4)
	Current tax income (expense)			-		(5)	(5)		-		2	2
	Deferred tax income			-		-	-		-		1	1
			9	124		253	377		130		(63)	67


* As defined in note 2

Consolidated Statement of Comprehensive Income
for the year ended 31 March 2014



	2014	2013
	£m	£m


Profit for the year after taxation	1,116	284

Other comprehensive income:

Items that will not be reclassified subsequently to profit or loss:
Net actuarial loss on pension scheme	(2)	(2)
	(2)	(2)

Items that may be reclassified subsequently to profit or loss:
Gains (losses) on cash flow hedges
- Group	14	(16)
- Joint ventures and funds	48	(6)
	62	(22)

Transferred to the income statement (cash flow hedges)
- Foreign currency derivatives	8	(5)
- Interest rate derivatives	15	26
	23	21

Exchange differences on translation of foreign operations
- Hedging and translation	2	(4)
- Other	1	6
	3	2
Deferred tax taken to equity	5	-
	5	-
Other comprehensive profit (loss) for the year	91	(1)


Total comprehensive income for the year attributable to shareholders of the Company	1,207	283


Attributable to non-controlling interests	10	-
Attributable to shareholders of the Company	1,197	283

Consolidated Balance Sheet
as at 31 March 2014


		2014		2013
	Note	£m		£m
ASSETS
Non-current assets
Investment and development properties	8	7,272		5,488
Owner-occupied property	8	47		42
		7,319		5,530

Other non-current assets
Investments in joint ventures and funds	9	2,712		2,336
Other investments	10	262		76
Interest rate derivative assets	15	32		92
		10,325		8,034

Current assets
Trading properties	8	271		40
Debtors	11	41		60
Cash and short-term deposits	15	142		135
		454		235

Total assets		10,779		8,269

LIABILITIES
Current liabilities
Short-term borrowings and overdrafts	15	(495)		(44)
Creditors	12	(263)		(259)
Corporation tax		(8)		(17)
		(766)		(320)

Non-current liabilities
Debentures and loans	15	(2,803)		(2,134)
Other non-current liabilities	13	(32)		(26)
Deferred tax liabilities	14	(4)		(16)
Interest rate derivative liabilities	15	(57)		(86)
		(2,896)		(2,262)

Total liabilities		(3,662)		(2,582)

Net assets		7,117		5,687

EQUITY
Share capital	19	255		249
Share premium		1,257		1,242
Merger reserve		213		213
Other reserves		(70)		(163)
Retained earnings		5,091		4,146

Equity attributable to shareholders of the Company		6,746		5,687
Non-controlling interests		371		-
Total Equity		7,117		5,687

EPRA NAV per share*	2	688	p	596	p

* As defined in note 2.

Consolidated Statement of Cash Flows
for the year ended 31 March 2014


		2014	2013
	Note	£m	£m


Rental income received from tenants		312	266
Fees and other income received		19	19
Operating expenses paid to suppliers and employees		(88)	(88)
Cash generated from operations		243	197


Interest paid		(116)	(113)
Interest received		29	31
UK corporation tax received		-	1
Distributions and other receivables from joint ventures and funds		63	74
Net cash inflow from operating activities		219	190


Cash flows from investing activities
Development and other capital expenditure		(175)	(230)
Purchase of investment properties		(569)	(442)
Sale of investment properties		352	699
Purchase of investments		(84)	-
Sale of investments		8	2
Deferred consideration received		5	18
Acquisition of Hercules Unit Trust	18	(145)	-
Cash aquired on acquisition of subsidiary	18	18	-
Purchase of joint ventures and funds		(113)	-
Sale of joint ventures and funds		179	-
Investment in and loans to joint ventures and funds		(162)	(318)
Capital distributions and loan repayments from joint ventures and funds		28	72
Indirect taxes (paid) received in respect of investing activities		(2)	(3)
Net cash outflow from investing activities		(660)	(202)


Cash flows from financing activities
Issue of ordinary shares		11	493
Dividends paid	16	(159)	(203)
Closeout of interest rate derivative		(16)	4
Movement in other financial liabilities		(8)	2
Disposal of liquid investments	15	-	210
Decrease in bank and other borrowings		(49)	(889)
Drawdowns on bank and other borrowings		669	-
Proceeds on convertible bond issue		-	393
Net cash inflow from financing activities		448	10


Net (decrease) increase in cash and cash equivalents		7	(2)
Cash and cash equivalents at 1 April		135	137
Cash and cash equivalents at 31 March		142	135


Cash and cash equivalents consists of:
Cash and short-term deposits	15	142	135

Consolidated Statement of Changes in Equity for the year ended 31 March 2014
	Sharecapital *	Sharepremium	Hedging and translation reserve ,*	Revaluation reserve *	Merger reserve *	Retained earnings	Total	Non-controlling interest	Total Equity
	£m	£m	£m	£m	£m	£m	£m	£m	£m
Balance at 1 April 2013	249	1,242	(71)	(92)	213	4,146	5,687	-	5,687
Profit for the year after taxation						1,106	1,106	10	1,116
Losses on cash flow hedges			14				14		14
Revaluation through statement of changes in equity						1	1		1
Joint ventures and funds revaluations				48			48		48
Reclassification of gains (losses) on cash flow hedges
- Foreign currency derivatives			8				8		8
- Interest rate derivatives			15				15		15
Exchange differences on translation of foreign operations			2	1		(1)	2		2
Net actuarial loss on pension schemes						(2)	(2)		(2)
Deferred tax taken to equity				5			5		5
Other comprehensive income (loss)	-	-	39	54	-	(2)	91	-	91
Total comprehensive income for the year	-	-	39	54	-	1,104	1,197	10	1,207
Share issues	6	15				(8)	13		13
Non-controlling interest on acquisition of subsidiary								374	374
Purchase of units from non-controlling interest								(13)	(13)
Adjustment for share and share option awards						10	10		10
Dividends payable in year (26.7p per share)						(266)	(266)		(266)
Transfer									-
Adjustment for scrip dividend element						105	105		105
Balance at 31 March 2014	255	1,257	(32)	(38)	213	5,091	6,746	371	7,117


Balance at 1 April 2012	225	1,237	(72)	(92)	-	3,806	5,104	-	5,104
Profit for the year after taxation						284	284		284
Losses on cash flow hedges			(16)				(16)		(16)
Joint ventures and funds revaluations				(6)			(6)		(6)
Reclassification of gains (losses) on cash flow hedges									-
- Foreign currency derivatives			(5)				(5)		(5)
- Interest rate derivatives			26				26		26
Exchange differences on translation of foreign operations			(4)	6			2		2
Net actuarial loss on pension schemes						(2)	(2)		(2)
Other comprehensive income (loss)	-	-	1	-	-	(2)	(1)	-	(1)
Total comprehensive income for the year	-	-	1	-	-	282	283	-	283
Share issues	24	5			464		493		493
Adjustment for share and share option awards						9	9		9
Dividends payable in year (26.3p per share)						(234)	(234)		(234)
Transfer					(251)	251			-
Adjustment for scrip dividend element						32	32		32
Balance at 31 March 2013	249	1,242	(71)	(92)	213	4,146	5,687	-	5,687
* refer to note 19
** The balance at the beginning of the period includes £2m relating to translation and £(73)m relating to hedging.

Notes to the accounts for the year ended 31 March 2014

1. Basis of preparation

The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 March 2014 or 2013, but is derived from those accounts. Statutory accounts for 2013 have been delivered to the Registrar of Companies and those for 2014 will be delivered following the Company's annual general meeting. The auditor has reported on those accounts; their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain statements under s498(2) or (3) of Companies Act 2006 or equivalent preceding legislation.

The financial statements for the year ended 31 March 2014 have been prepared on the historical cost basis, except for the revaluation of properties, investments and derivatives. The financial statements have also been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and therefore comply with Article 4 of the EU IAS Regulation.

While the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRSs), this announcement does not itself contain sufficient information to comply with IFRSs. The Company expects to publish full financial statements that comply with IFRSs in June 2014.

In the current financial year the Group has adopted the amendments to IAS 1 "Presentation of Items of Other Comprehensive Income", IFRS 13 "Fair Value Measurement" and IAS 19 (revised) "Employee Benefits".

• The amendments to IAS 1 require items of other comprehensive income to be grouped by those items that will be reclassified subsequently to profit or loss and those that will never be reclassified, as well as their associated income tax. The amendments have been applied retrospectively and hence the presentation of items of comprehensive income has been re-grouped accordingly.

• IFRS 13 impacts the disclosure of investment and owner-occupied properties, as set out in note 8.

• IAS 19 (revised) and the related consequential amendments have impacted the accounting for the Group's defined benefit pension scheme, by replacing the interest cost and expected return on plan assets with a net interest charge on the net defined benefit liability. The impact of adopting IAS 19 (revised) is not considered material.

Otherwise the accounting policies used are consistent with those contained in the Group's last annual report and accounts for the year ended 31 March 2013.

Standards and interpretations issued but not effective for the current accounting period were:

• IFRS 9 - Financial Instruments;

• IAS 32 (amended) - Financial Instruments: Presentation;

• IFRS 10 - Consolidated Financial Statements;

• IFRS 11 - Joint Arrangements;

• IFRS 12 - Disclosure of Interests in Other Entities;

• IAS 12 (amended) - Deferred Tax: recovery of underlying assets;

• IAS 27 (revised) - Separate Financial Statements;

• IAS 28 (revised) - Investments in Associates and Joint Ventures; and

• IAS 36 - Recoverable Amount Disclosures for Non-Financial Assets.

The Directors do not expect that the adoption of the standards listed above will have a material impact on the financial statements of the Group in future periods except as follows:

• IFRS 9 will impact both the measurement and disclosures of financial instruments.

The financial statements have been prepared on the going concern basis as stated in the directors' responsibility statement.

2. Performance measures


	2014			2013
Earnings per share (diluted unless otherwise stated)	Earnings	Penceper share		Earnings	Penceper share
	£m	Penceper share		£m	Penceper share

Underlying pre-tax profit attributable to shareholders of the company- income statement	297			274
Tax charge relating to underlying profit	(2)			(1)

Underlying earnings	295	29.4	p	273	30.3	p

Mark-to-market on / profit on disposal of liquid investments (held for trading assets)	-			9
Mark-to-market adjustment on convertible bond	-			(7)
Non-recurring items*	-			(7)

EPRA earnings - diluted	295	29.4	p	268	29.7	p
Remove dilution of share options		0.1	p		0.2	p
EPRA earnings - basic		29.5	p		29.9	p

Profit for the year after taxation	1,106	110.2	p	284	31.5	p

*Non-recurring items for the year ended 31 March 2013 of £7m relate to the issue costs for the convertible bond.

The European Public Real Estate Association (EPRA) has issued Best Practices Recommendations, the latest update of which was issued in January 2014, which give guidelines for performance measures. EPRA earnings is the profit after tax excluding investment and development property revaluations and gains or losses on disposals, changes in the fair value of financial instruments and associated close-out costs and their related taxation. A summary of the EPRA Performance Measures is provided in Table B within the Supplementary Disclosures.

Underlying earnings consists of the EPRA earnings (diluted) measure, with additional Company adjustments. Adjustments include mark to market adjustments on held for trading assets.

The weighted average number of shares in issue for the year was: basic: 999m (2013: 895m); diluted for the effect of share options: 1,004m (2013: 901m). Basic undiluted earnings per share for the year, calculated using profit for the year after taxation of £1,106m (2013: £284m), was 110.7p (2013: 31.7p). Earnings per share shown in the table above are diluted.

	31 March		31 March
Net asset value (NAV) (diluted)	2014		2013
	£m		£m

Balance sheet net assets	7,117		5,687
Less non-controlling interests	(371)		-
Deferred tax arising on revaluation movements	6		14
Mark-to-market on effective cash flow hedges and related debt adjustments	173		198
Surplus on trading properties	63		10
Dilution effect of share options	39		58

EPRA NAV	7,027		5,967

EPRA NAV per share	688	p	596	p


The EPRA NAV per share excludes the mark to market on effective cash flow hedges, related debt adjustments and the convertible bond, deferred taxation on revaluations and surplus on trading properties and is calculated on a fully diluted basis. The EPRA Best Practices Recommendations additional guidance, issued in January 2014, has adjusted the treatment of mark-to-market valuations on convertible bonds for the calculation of NAV per share. This update has provided a 1p increase in EPRA NAV per share in the current year.

At 31 March 2014, the number of shares in issue was: basic: 1,008m (2013: 986m); diluted for the effect of share options: 1,021m (2013: 1001m).

Total accounting return per share for the year ended 31 March 2014 of 20.0% includes dividends of 27.0p (see note 16) in addition to the increase in EPRA NAV of 92p. Total accounting return per share for the year ended 31 March 2013 was 4.6%.

3. Gross and net rental and related income
	2014	2013
	£m	£m

Rent receivable	310	269
Spreading of tenant incentives and guaranteed rent increases	20	24
Surrender premia	4	1

Gross rental income	334	294

Service charge income	50	35

Gross rental and related income	384	329

Service charge expenses	(50)	(35)
Property operating expenses	(21)	(13)

Net rental and related income	313	281

The cash element of net rental income recognised during the year ended 31 March 2014 from properties which were not subject to a security interest was £189m (2013: £159m). Property operating expenses relating to investment properties that did not generate any rental income were £1m (2013: £1m). Contingent rents of £1m (2013: £1m) were recognised in the year.




4. Fees and other income
	2014	2013
	£m	£m

Management and performance fees (from joint ventures and funds)	10	10
Other fees and commissions	5	5

	15	15


5. Net revaluation gains on property and investments
	2014	2013
	£m	£m
Consolidated income statement
Revaluation of properties	580	71
Result on property and investment disposals	31	8
Revaluation of investments	4	9

	615	88
Share of valuation movements of joint ventures and funds	258	(62)

Net revaluation gains on property and investments	873	26

Profit on trading property
Sale proceeds	109	-
Cost of sales	(95)	-

Profit on trading property	14	-

6. Net financing costs
	2014	2013
	£m	£m
Interest payable on:
Bank loans and overdrafts	29	37
Other loans	77	75
Obligations under finance leases	1	1

	107	113
Development interest capitalised	(17)	(17)

	90	96
Interest receivable on:
Deposits, securities and liquid investments	(3)	(11)
Loans to joint ventures	(6)	(3)

	(9)	(14)

Other finance (income) costs:

Expected return on pension scheme assets	-	(7)
Interest on pension scheme liabilities	-	5
Valuation movements on translation of foreign currency debt	(9)	5
Hedging reserve recycling	9	(5)

Net financing costs - underlying	81	80

Capital and other:
Valuation movements on fair value debt	(62)	18
Valuation movements on fair value derivatives	62	(14)
Net capital movement on convertible bond	50	14
Recycling of fair value movement on close-out of derivatives	10	20
Valuation movement on translation of foreign currency net assets	(3)	(2)
Fair value movement on non-hedge accounted derivatives	-	3

Net financing costs - capital	57	39

Net financing costs	138	119

Total financing income	(12)	(23)
Total financing charges	150	142

Net financing costs	138	119


Interest on development expenditure is capitalised at a rate of 3.80% (2013: 4.00%).

7. Taxation
									2014	2013
									£m	£m
Tax (income) expense

Current tax:			UK corporation tax: 23% (2013: 24%)						2	1

									2	1
Adjustments in respect of prior years									(5)	(9)

Total current tax income									(3)	(8)
Deferred tax on revaluations									(3)	(16)

Group total taxation (net)									(6)	(24)

Attributable to joint ventures and funds									5	(3)

Total taxation income									(1)	(27)

Tax reconciliation
Profit on ordinary activities before taxation									1,105	257
Less: profit attributable to joint ventures and funds*									(382)	(64)

Group profit on ordinary activities before taxation									723	193

Tax on profit on ordinary activities at UK corporation tax rate of: 23% (2013: 24%)									166	46


Effects of:
	REIT exempt income and gains								(160)	(41)
	Tax losses								(4)	(6)
	Adjustments in respect of prior years								(8)	(23)

Group total taxation income									(6)	(24)

*A current tax charge of £5m (2013: credit of £2m) and a deferred tax charge of £nil (2013: credit of £1m) arose on profits attributable to joint ventures and funds. The low charges reflect the Group's REIT status.

Tax expense attributable to underlying profits for the year ended 31 March 2014 was £2m (2013: £1m). The underlying tax rate for the year ended 31 March 2014 was 0.7% (2013: 0.5%).

Corporation tax payable at 31 March 2014 was £8m (2013: £17m) as shown on the balance sheet.


8. Property


Property reconciliation 12 months to 31 March 2014
				Investment
				UK Retail	Offices & Residential	Developments	Subtotal	Trading Properties		Owner- occupied	Total
				Level 3	Level 3	Level 3	Level 3			Level 3
				£m	£m	£m	£m	£m		£m	£m

Carrying value at 1 April 2013				3,360	1,267	861	5,488	40		42	5,570


Additions:		- property purchases		53	428	83	564	-		-	564
		- acquisition of Hercules Unit Trust		1,006	-	-	1,006	-		-	1,006
		- development expenditure		10	30	60	100	38		-	138
		- capitalised interest		-	6	4	10	7		-	17
		- capital expenditure on asset management initiatives		25	4	-	29	-		-	29

				1,094	468	147	1,709	45		-	1,754

Depreciation				-	-	-	-	-		(1)	(1)
											-
Disposals				(234)	(11)	-	(245)	(97)		-	(342)
											-
Reclassifications				(5)	538	(816)	(283)	283		-	-

Revaluations included in income statement				240	270	65	575	-		5	580
											-
Revaluation included in SOCIE				-	-	-	-	-		1	1
											-
Movement in tenant incentives and contracted rent uplift balances				6	18	4	28	-		-	28


Carrying value at 31 March 2014				4,461	2,550	261	7,272	271		47	7,590

Head lease liabilities (note 13)											(32)
Surplus on trading properties											58

Total Group property portfolio valuation at 31 March 2014											7,616
Non-Controlling Interest											(422)
Total Group property portfolio valuation at 31 March 2014 attributable to shareholders											7,194


The different valuation method levels are defined below: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs). These levels are specified in accordance with IFRS 13 'Fair Value Measurement'. Property valuations are inherently subjective as they are made on the basis of assumptions made by the valuer which may not prove to be accurate. For these reasons, and consistent with EPRA's guidance, we have classified the valuations of our property portfolio as Level 3 as defined by IFRS 13. Some of the inputs to the valuations are defined as 'unobservable' by IFRS 13. The Group's policy is to recognise transfers between fair value hierarchy levels as of the date of the event or change in circumstances that caused the transfer. There have been no transfers during the period. At 31 March 2014, the Group book value of properties of £7,616m (2013: £5,554m) comprises freeholds of £4,855m (2013: £3,502m); virtual freeholds of £695m (2013: £709m); and long leaseholds of £2,066m (2013: £1,343m). The historical cost of properties was £5,574m (2013: £4,229m).


The property valuation does not include any investment properties held under operating leases (2013: £nil).

Properties valued at £1,741m (2013: £1,724m) were subject to a security interest and other properties of non-recourse companies amounted to £1,066m (2013: £40m).


During the year to 31 March 2014, a gross amount of £286m of investment properties were reclassified to trading properties, as since planning consent has been granted it is the Group's intention to redevelop and sell these properties. Some of these trading properties were subsequently sold in the period.


Included within the property valuation is £100m (2013: £91m) in respect of accrued contracted rental uplift income, against which the Group holds a provision of £5m (2013: £5m). The balance arises through the IFRS treatment of leases containing such arrangements, which requires the recognition of rental income on a straight line basis over the lease term, with the difference between this and the cash receipt changing the carrying value of the property against which revaluations are measured.




Cumulative interest capitalised against investment properties amounts to £73m (2013: £56m).

Valuation

The Group's total property portfolio was valued by external valuers on the basis of fair value, in accordance with the RICS Valuation - Professional Standards 2012, eighth edition, published by The Royal Institution of Chartered Surveyors.



The information provided to the valuers, and the assumptions and valuations models used by the valuers are reviewed by the property portfolio team, the Head of Offices, the Head of Retail and the Finance Director. The valuers meet with the External Auditors and also present directly to the Audit Committee at the interim and year-end review of results.



A breakdown of valuations split between the Group and its share of joint ventures and funds is shown below:

					2014			2013
					Group	Joint Ventures and Funds	Total	Group		Joint Ventures and Funds	Total
					£m	£m	£m	£m		£m	£m

Knight Frank LLP					6,036	2,903	8,939	5,084		2,680	7,764
CBRE					1,580	2,131	3,711	470		2,265	2,735
Total property portfolio valuation					7,616	5,034	12,650	5,554		4,945	10,499
Non-controlling interest share of property					(422)	(188)	(610)	-		-	-
Total property portfolio valuation attributable to shareholders					7,194	4,846	12,040	5,554		4,945	10,499

9. Joint ventures and funds

Summary movement for the year of the investments in joint ventures and funds

		Joint Ventures	Funds	Total	Equity	Loans 1	Total
		£m	£m	£m	£m	£m	£m

At 1 April 2013		1,886	450	2,336	1,843	493	2,336
Additions		175	445	620	569	51	620
Disposals		(199)	(436)	(635)	(481)	(154)	(635)
Share of profit after taxation		370	7	377	377	-	377
Distributions and dividends:	Capital	0	(1)	(1)	(1)	-	(1)
	Revenue	(71)	(31)	(102)	(102)	-	(102)
Reclassification of amounts owed from joint ventures		44	0	44		44	44
Hedging and exchange movements		69	4	73	73	-	73

At 31 March 2014		2,274	438	2,712	2,278	434	2,712

1. Comparatives have been re-presented between equity and loans to better reflect the nature of historical investments.

PREF, a fund owning a portfolio of retail property in Europe (in which British Land has a net investment of £54m), has its properties externally valued by CBRE. CBRE have included a market uncertainty clause in the valuation report of the Portuguese and Spanish properties, due to a lack of transactional evidence and uncertainty over the economic situation in those markets. In 2013 PREF made partial early repayments of debt totalling €18m. In March 2014, following the sale of its Italian asset, €44m of debt was repaid. PREF now has €37m of bank loans that are due to mature in the calendar year 2015. In December 2013 a one year extension of the fund to 26 March 2015 was approved. At 31 March 2014 the investment in joint ventures included within the total investment in joint ventures and funds was £2,658m (2013:£1,889m).


Distributions in the year include the receipt of £6m from the Broadgate joint venture, £2m from the Meadowhall joint venture, £4m from Sainsbury's joint venture, £17m from Tesco joint ventures and £23m from HUT.


At 31 March 2014, the valuation of the Group's share of joint ventures and funds properties was £5,034m (2013: £4,945m); surplus on the Group's share of joint ventures and funds' trading properties was £5m (2013: £nil); external net debt was £2,113m (2013: £2,427m) and the mark-to-market adjustment for external debt was £123m liability (2013: £193m liability).

9. Joint ventures and funds (continued): Joint ventures' and funds' summary financial statements

A detailed breakdown of the Group's share of results of specific joint ventures and funds for the year ended 31 March 2014 is set out on the two following pages. All disclosures have been restated to British Land accounting policies under IFRS eliminating all profits and losses resulting from upstream and downstream transactions with the Group.In the prior year the detailed breakdown contained 100% of the results of the specific joint ventures and funds. It is considered that the change in presentation, to our share, results in a more understandable disclosure.


	Bluebutton Properties Ltd	MSC Property Intermediate Holdings Ltd	BL Sainsbury Superstores Ltd	Tesco Joint Ventures*	The Southgate Limited Partnership	USS Joint Ventures**



	Euro CloverPrivate Ltd (GIC)	Norges Bank Investment Management				Universities Superannuation Scheme Group PLC
Partners	Euro CloverPrivate Ltd (GIC)	Norges Bank Investment Management	J Sainsbury plc	Tesco PLC	Aviva Investors	Universities Superannuation Scheme Group PLC

Property sector	City Offices Broadgate	Shopping Centres Meadowhall	Superstores	Superstores	Shopping Centres	Shopping Centres
	City Offices Broadgate	Shopping Centres Meadowhall	Superstores	Superstores	Shopping Centres	Shopping Centres
Group share	50%	50%	50%	50%	50%	50%

Summarised income statements	£m	£m	£m	£m	£m	£m


Gross rental and related income	108	46	32	51	4	5

Net rental and related income	81	38	32	47	2	4
Other income and expenditure				(1)
Net interest payable	(45)	(19)	(15)	(28)

Underlying profit before taxation	36	19	17	18	2	4
Surplus (deficit) on revaluation	143	4	3	43	2	10
Disposal of fixed assets
Non-recurring items

Profit (loss) on ordinary activities before taxation	179	23	20	61	4	14
Current tax				(1)
Deferred tax

Profit (loss) on ordinary activities after taxation (British Land share)	179	23	20	60	4	14


Summarised balance sheets	£m	£m	£m	£m	£m	£m

Investment properties	1,712	770	604	898	103	99
Current assets	4	1		1	2
Upstream loans to joint venture shareholders
Cash and deposits	135	16	10	16	2	4
Gross assets	1,851	787	614	915	107	103

Current liabilities	(63)	(21)	(16)	(60)	(3)	(2)
Bank debt	(165)			(504)
Securitised debt	(881)	(372)	(294)
Obligations under finance leases		(2)
Deferred tax	5		1	(9)
Gross liabilities	(1,104)	(395)	(309)	(573)	(3)	(2)

Net external assets (British Land share)	747	392	305	342	104	101

Represented by:
Shareholder loans	52	105	4	52		7
Ordinary shareholders' funds/partners' capital	695	287	301	290	104	94
Total investment (British Land share)	747	392	305	342	104	101


\* Tesco joint ventures include BLT Holdings (2010) Limited, the Tesco British Land Property Partnership, Tesco BL Holdings Limited, Shopping Centres Limited and the Tesco Aqua Limited Partnership.

** USS joint ventures include the Eden Walk Shopping Centre Unit Trust and the Fareham Property Partnership.

9. Joint ventures and funds (continued): joint ventures' and funds' summary financial statements

A detailed breakdown of the Group's share of results of specific joint ventures and funds is set out on the current and previous page. The total column represents the Group's share of all joint ventures and funds. All disclosures have been restated to British Land accounting policies under IFRS eliminating all profits and losses resulting from upstream and downstream transactions with the Group.




	Leadenhall	Hercules Unit Trust	Other		TOTAL	TOTAL
	Holding Co	Joint Ventures	joint ventures		Group share	Group share
	(Jersey) Ltd	and Sub-Funds***	and funds	+*	2014	2013

	Oxford
Partners	Properties

Property sector	City Offices	Retail
	Leadenhall	Parks

Group share	50%	Various

Summarised income statements	£m	£m	£m		£m	£m


Gross rental and related income	-	40	21		307	306

Net rental and related income		34	15		253	260
Other income and expenditure	-	(1)	(4)		(6)	(4)
Net interest payable	-	(12)	(4)		(123)	(126)

Underlying profit before taxation		21	7		124	130
Surplus (deficit) on revaluation	67	6	(16)		262	(61)
Disposal of fixed assets	-	(4)	-		(4)	(1)
Non-recurring items	-					(4)

Profit (loss) on ordinary activities before taxation	67	23	(9)		382	64
Current tax		-	(4)		(5)	2
Deferred tax		-				1

Profit (loss) on ordinary activities after taxation (British Land share)	67	23	(13)		377	67


Summarised balance sheets	£m	£m	£m		£m	£m

Investment properties	265	456	124		5,031	4,949
Current assets	1	2	20		31	62
Upstream loans to joint venture shareholders	-	-	4		4	4
Cash and deposits	1	6	9		199	215
Gross assets	267	464	157		5,265	5,230

Current liabilities	(3)	(5)	(44)		(217)	(340)
Bank debt		(75)	(39)		(783)	(955)
Securitised debt		-	-		(1,547)	(1,592)
Obligations under finance leases		-	(1)		(3)	(5)
Deferred tax		-	-		(3)	(2)
Gross liabilities	(3)	(80)	(84)		(2,553)	(2,894)

Net external assets (British Land share)	264	384	73		2,712	2,336

Represented by:
Shareholder loans	157	-	57		434	493
Ordinary shareholders' funds / Partners' capital	107	384	16		2,278	1,843
Total investment (British Land share)	264	384	73		2,712	2,336


*** On 17th February 2014 Hercules Unit Trust (HUT) became a subsidiary of the Group (note 18). The income statement results for HUT includes the Group's share of results from the HUT consolidated group up to and including 17th February 2014. Thereafter, only the Group's share of results of the HUT joint ventures and sub-fund are shown. This includes 50% of the results of Deepdale Co-Ownership Trust, Speke Unit Trust, Gibraltar Limited Partnership and Valentine Co-Ownership Trust and 41.25% of Birstall Co-Ownership Trust. The balance sheet shows our ownership of the assets of these joint ventures and sub-funds detailed above.

Comparatives have been re-presented to better reflect the nature of our historical investments.

+* Included in the column headed 'Other joint ventures and funds' are contributions from the following: BL Goodman Limited Partnership, BL Gazeley Limited, Eurofund Investments Zaragoza S.L (disposed of during the year), The Scottish Retail Property Limited Partnership (disposed of during the year), The Aldgate Place Limited Partnership, Bluebutton Property Management UK Limited, BL Residential Limited Partnership, Pillar Retail Europark Fund (PREF) and City of London Office Unit Trust (CLOUT). The Group's ownership share of PREF is 65%, however as the group does not exercise control over significant decisions of the fund, the Group equity accounts for its interest in PREF.



The borrowings of joint ventures and funds and their subsidiaries are non-recourse to the Group. All joint ventures are incorporated in the United Kingdom, with the exception of Bluebutton Properties Limited, the Eden Walk Shopping Centre Unit Trust and Leadenhall Holding Co (Jersey) Limited which are domiciled in Jersey. Of the funds, Hercules Unit Trust (HUT) is domiciled in Jersey and PREF in Luxembourg.

9. Joint ventures and funds (continued)

Operating cash flows of joint ventures and funds (Group share)

2014

2013

£m

Rental income received from tenants

274

264

Operating expenses paid to suppliers and employees

(33)

(22)

Cash generated from operations

241

242

Interest paid

(135)

(133)

Interest Received

UK corporation tax paid

(6)

(7)

Foreign Tax Paid

(3)

Cash inflow from operating activities

102

Cash inflow from operating activities deployed as:

Surplus cash retained within joint ventures and funds

Revenue distributions to British Land

102

10. Other investments

2014

2013

Investments held for trading

Loans and receivables

Total

Investments held for trading

Loans and receivables

Total

£m

At 1 April 2013

Additions

104

187

Disposals

(10)

(4)

Revaluation

Depreciation

(1)

At March 2014

170

262

The investment held for trading comprises interests as a trust beneficiary. The trusts' assets comprise freehold reversions in a pool of commercial properties, comprising Sainsbury's superstores.

The investment has been categorised as level 3 in the fair value hierarchy (see note 8). Fair value of the interest has been determined by the Directors, supported by an external valuation from CBRE. The superstore assets are subject to the same assumption ranges and sensitivities disclosed in note 8.

Included within additions to loans and receivables is £92m (2012/13: £53m) in relation to a loan to Bluebutton Properties Limited, a joint venture company.

11. Debtors

2014

2013

£m

Trade and other debtors+

Amounts owed by joint ventures

Prepayments and accrued income

+ Included within this balance is deferred consideration of £1m (2013: £4m) arising on the sale of investment properties for which the timing of the receipt is contingent and therefore may fall due after one year.

Trade and other debtors are shown after deducting a provision for bad and doubtful debts of £15m (2013: £11m). The charge to the income statement was £nil (2013: £1m).

The Directors consider that the carrying amount of trade and other debtors are approximates to their fair value. There is no concentration of credit risk with respect to trade debtors as the Group has a large number of customers who are paying their rent in advance.

12. Creditors
			2014	2013
			£m	£m

Trade creditors			85	94
Amounts owed to joint ventures			4	4
Other taxation and social security			21	24
Accruals and deferred income			153	137

			263	259

Trade creditors are interest-free and have settlement dates within one year. The Directors consider that the carrying amount of trade and other creditors is approximate to their fair value.

13. Other non-current liabilities
			2014	2013
			£m	£m

Head leases			32	26

			32	26

14. Deferred Tax Liabilities

Deferred tax is calculated on temporary differences under the liability method using a tax rate of 20% (2013: 23%).
The movement on deferred tax is as shown below:

	1 April	Credited	Transferred to	31 March
	2013	to income	joint ventures	2014
	£m	£m	£m	£m

Property and investment revaluations	12	(3)	(9)	-
Other timing differences	4	-	-	4

	16	(3)	(9)	4

Under the REIT regime development properties which are sold within three years of completion do not benefit from tax exemption. At 31 March 2014 the value of such properties is £455m (2013: £nil) and if these properties were to be sold and tax exemption was not available the tax arising would be £34m (2013: £nil).

The deferred tax charge for the year ended 31 March 2014 includes a credit of £2m to reflect reduced deferred tax liabilities arising from the forthcoming reduction in the UK corporation tax rate to 20% (effective from 1 April 2015).

Deferred tax assets of £39m (2013: £40m) arising on losses from previous years have not been recognised in the financial year.

15. Net debt
		2014	2013
	Footnote	£m	£m
Secured on the assets of the Group
9.125% First Mortgage Debenture Stock 2020	1.1	36	37
6.125% First Mortgage Debenture Stock 2014	1.1	44	45
5.264% First Mortgage Debenture Bonds 2035		344	345
5.0055% First Mortgage Amortising Debentures 2035		100	101
5.357% First Mortgage Debenture Bonds 2028		327	334
6.75% First Mortgage Debenture Bonds 2020		176	181
Bank loans	1.2	523	-
Loan notes		2	5

		1,552	1,048
Unsecured

5.50% Senior Notes 2027		98	98
6.30% Senior US Dollar Notes 2015	2	92	101
3.895% Senior US Dollar Notes 2018	3	25	28
4.635% Senior US Dollar Notes 2021	3	136	158
4.766% Senior US Dollar Notes 2023	3	83	97
5.003% Senior US Dollar Notes 2026	3	52	62
3.81% Senior Notes 2026		99	-
3.97% Senior Notes 2026		101	-
1.5% Convertible Bond 2017		458	407
Bank loans and overdrafts		602	179

		1,746	1,130
Gross debt	4	3,298	2,178

Interest rate derivatives liabilities		57	86
Interest rate derivatives assets		(32)	(92)

		3,323	2,172

Cash and short-term deposits	5,6	(142)	(135)

Total net debt		3,181	2,037
Net debt attributable to non-controlling interests		(204)	-
Net debt attributable to shareholders of the Company		2,977	2,037

Total borrowings where any instalments are due after five years are £102m (2013: £103m).

				2014	2013
1	These are non-recourse borrowings with no recourse for repayment to other companies or assets in the Group:			£m	£m

		1.1	BLD Property Holdings Ltd	80	82
		1.2	Hercules Unit Trust	523	-
				603	82
2	Principal and interest on this borrowing was fully hedged into sterling at the time of issue.
3	Principal and interest on this borrowing was fully hedged into sterling at a floating rate at the time of issue.

4	The principal amount of gross debt at 31 March 2014 was £3,209m (2013: £2,063m). Included in this is the principal amount of secured borrowings and other borrowings of non-recourse companies of £1,505m, of which the proportion of the borrowings of the partly-owned subsidiary, Hercules Unit Trust, not beneficially owned by the Group is £219m.

5	Included within cash and short-term deposits is the cash and short-term deposits of Hercules Unit Trust, of which £14m is the proportion not beneficially owned by the Group.
6	Cash and deposits not subject to a security interest amount to £93m (2013: £106m).

Maturity analysis of net debt		2014	2013
		£m	£m

Repayable:	within one year and on demand	495	44
Between:	one and two years	90	188
	two and five years	1,084	522
	five and ten years	465	441
	ten and fifteen years	783	602
	fifteen and twenty years	6	5
	twenty and twenty five years	375	376
		2,803	2,134
Gross debt		3,298	2,178
Interest rate and currency derivatives		25	(6)
Cash and short-term deposits		(142)	(135)

Net debt		3,181	2,037

15. Net debt (continued)

British Land Unsecured Financial Covenants

The two financial covenants applicable to the Group unsecured debt including convertible bonds are:

Net Borrowings not to exceed 175% of Adjusted Capital and Reserves

At 31 March 2014, the ratio was 40%:

i. Net borrowings were £2,896m, being the principal amount of gross debt of £3,209m, less the relevant proportion of borrowings of the partly-owned subsidiary of £219m, plus amounts owed to joint ventures of £4m (see note 12), plus TPP Investments Ltd of £30m (see note 17), less the beneficially owned cash and deposits of £128m (being £142m less the relevant proportion of cash and deposits of the partly-owned subsidiary of £14m); and

ii. Adjusted Capital and Reserves were £7,301m, being share capital and reserves of £6,746m (see balance sheet), adjusted for £6m of deferred tax (see note 2), £63m trading property surpluses (see notes 8 and 9), £313m exceptional refinancing charges (see below) and £173m fair value adjustments on financial assets and liabilities (being £115m mark-to-market on interest derivatives and £58m adjustment on the convertible bond).

Net Unsecured Borrowings not to exceed 70% of Unencumbered Assets

At 31 March 2014 the ratio was 31%:

i. Net Unsecured Borrowings were £1,615m, being the principal amount of gross debt of £3,209m, plus amounts owed to joint ventures of £4m (see note 12) less cash and deposits not subject to a security interest of £93m less the principal amount of secured and non-recourse borrowings of £1,505m; and

ii. Unencumbered Assets were £5,125m being properties of £7,616m (see note 8) plus investments in joint ventures and funds of £2,712m (see balance sheet) and other investments of £262m (see balance sheet) less investments in joint ventures of £2,658m (see note 9) and encumbered assets of £2,807m (see note 8).

In calculating Adjusted Capital and Reserves for the purpose of the unsecured debt financial covenants, there is an adjustment of £313m to reflect the cumulative net amortised exceptional items relating to the refinancings in the years ended 31 March 2005, 2006 and 2007.

Interest rate profile - including effect of derivatives

2014

2013

£m

Fixed rate

2,208

1,848

Variable rate (net of cash)

973

189

Net debt

3,181

2,037

Reconciliation of movement in Group Net Debt to Cash Flow Statement

2013

Cash flow

Non cash

2014

£m

Per Cash Flow Statement:

Cash and short-term deposits

(135)

(7)

(142)

Cash and cash equivalents

(135)

(7)

(142)

Term debt (excluding overdrafts)

2,178

620

500

3,298

Fair value of interest rate derivatives

(6)

(16)

Net debt

2,037

597

547

3,181

The Group Loan to Value (LTV) ratio at 31 March 2014 is 29%, being principal value of gross debt of £3,209m less the relevant portion of borrowings of the partly-owned subsidiary of £219m, less cash and short-term deposits of £128m (being £142m less the relevant proportion of cash and deposits of the partly-owned subsidiary of £14m), divided by total Group property of £7,616m (see note 8) plus investments in joint ventures and funds of £2,712m (see balance sheet) and other investments of £262m (see balance sheet) less the relevant portion of property and investments of the partly-owned subsidiary of £581m.

15. Net debt (continued)

Maturity of committed undrawn borrowing facilities

2014

2013

£m

Maturity date:

over five years

160

between four and five years

310

108

between three and four years

140

870

Total facilities available for more than three years

610

978

between two and three years

942

between one and two years

757

within one year

410

369

Total

1,962

2,104

The above facilities are available to be drawn for Group purposes.

Comparison of market values and book values at 31 March 2014

Level

Market

Book

Value

Difference

£m

Debentures and unsecured bonds

1,722

1,713

Convertible bond

458

Bank debt and other floating rate debt

1,138

1,127

Cash and short-term deposits

(142)

3,176

3,156

Other financial (assets) liabilities:

- interest rate derivative assets

(32)

- interest rate derivative liabilities

Total

3,201

3,181

Short-term debtors and creditors have been excluded from the disclosures.

The fair values of debt, debentures and the convertible bond have been established by obtaining quoted market prices from brokers. The bank debt and loan notes have been valued assuming they could be renegotiated at contracted margins. The derivatives have been valued by calculating the present value of expected future cash flows, using appropriate market discount rates, by an independent treasury advisor.

Fair value heirachy

The table below analyses financial instruments carried at fair value, by the valuation method. The different levels are defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

	2014
	Level 1	Level 2	Level 3	Total
	£m	£m	£m	£m

Interest rate and currency derivative assets	-	(32)	-	(32)

Assets	-	(32)	-	(32)

Interest rate and currency derivative liabilities	-	57	-	57
Convertible bond	458	-	-	458

Liabilities	458	57	-	515

Total	458	25	-	483

16. Dividend

The fourth quarter dividend of 6.75 pence per share, totalling £68m (2012/13: 6.6 pence per share, totalling £65m) was approved by the Board on 13 May 2014 and is payable on 8 August 2014 to shareholders on the register at the close of business on 4 July 2014.

The Board will announce the availability of the Scrip Dividend Alternative via the Regulatory News Service and on its website (www.britishland.com), no later than 4 business days before the ex-dividend date of 2 July 2014. The Board expects to announce the split between Property Income Distributions ('PID') and non-PID income at that time. Any Scrip Dividend Alternative will not be enhanced. PID dividends are paid, as required by REIT legislation, after deduction of withholding tax at the basic rate (currently 20%), where appropriate. Certain classes of shareholders may be able to elect to receive dividends gross. Please refer to our website (www.britishland.com) for details.

PaymentDate

Dividend

PID

Non PID

Pence per share

2014£m

2013£m

Current year dividends

08.08.2014

2014 4th interim

6.75

02.05.2014

2014 3rd interim

6.75

14.02.2014

2014 2nd interim

6.75

08.11.2013

2014 1st interim

6.75

27.00

Prior year dividends

09.08.2013

2013 4th interim

6.60

10.05.2013

2013 3rd interim

6.60

15.02.2013

2013 2nd interim

6.60

09.11.2012

2013 1st interim

6.60

26.40

10.08.2012

2012 4th interim

3.30

6.60

09.05.2012

2012 3rd interim

6.50

Dividends in Consolidated Statement of Changes in Equity

266

234

Dividends settled in shares

(105)

(32)

Dividends settled in cash

161

202

Timing difference relating to payment of withholding tax

(2)

Dividends in Cash Flow Statement

159

203

* Scrip alternative treated as non-PID for this dividend.

17. Contingent liabilities

The Group has contingent liabilities in respect of legal claims, guarantees and warranties arising in the ordinary course of business. It is not anticipated that any material liabilities will arise from contingent liabilities.

TPP Investments Limited, a wholly owned ring-fenced special purpose subsidiary, is a partner in The Tesco British Land Property Partnership and, in that capacity, has entered into a secured bank loan under which its liability is limited to £30m (2013: £30m) and recourse is only to the partnership assets.

18. Acquisition of a Subsidiary (Business Combination)

On 17 February 2014, the Group acquired additional units of the Hercules Unit Trust, a Unit Trust registered in Jersey which is engaged in property investment, resulting in a cumulative ownership of 57.2% of the outstanding units and control of the underlying entity. Management determined that the acquisition of control should be accounted for as a business combination in accordance with IFRS 3 'Business Combinations'. Following this transaction additional units were purchased bringing cumulative ownership to 58.6% at 31st March 2014.

The fair value of the Group's 49.2% equity interest in the Hercules Unit Trust held before the business combination amounted to £430m. No gain or loss was recognised as a result of measuring the equity interest at fair value.

Subsequent to 31 March 2014 further purchases resulted in a cumulative ownership of 59.8%.

The acquired subsidiary has contributed net revenues of £12m and profit of £18m to the Group for the period from the date of acquisition to 31 March 2014. If the acquisition had occurred on 1 April 2013 with all other variables held constant Group net revenue for 2014 would have increased by £49m, and underlying profit for 2014 would have increased by £23m.

Details of the assets and bargain purchase arising are as follows:

Attributed fair value

£m

Investment Property

1,006

Investments in joint ventures and funds

376

Other net current liabilities

(4)

Cash and cash equivalents

Debenture and loans

(522)

Fair value of acquired interest in net assets of subsidiary

874

Bargain purchase (negative goodwill)

(3)

Total purchase consideration

871

Less: Fair value of previously held interest

(430)

Non-controlling interest

(374)

Cash consideration

Additional units purchased in the year

Total acquisition of Hercules Unit Trust

145

The purchase consideration disclosed above comprises cash and cash equivalents paid to the acquiree's previous owner of £67m. The bargain purchase is a result of unit acquisitions trading at a discount in the secondary market. The gain on bargain purchase is recognised in net valuation movement.

The non-controlling interest (42.8% ownership interest in Hercules Unit Trust) recognised at the acquisition date was measured by reference to the present ownership interest's proportionate share in the acquiree's recognised amounts of the identifiable net assets and amounted to £374m.

The valuation of investment property at the acquisition date was performed by an external professional appraiser with experience of the relevant market. The fair value of cash and cash equivalents was considered equal to the carrying value representing the entity's bank deposits; fair value of borrowings and trade and other payables was calculated based on discounted cash flow models. The acquired bank loans and overdrafts have no recourse to other companies or assets in the Group.

19. Share capital and reserves

2014

2013

Number of ordinary shares in issue at 1 April

997,691,488

900,199,638

Share issues

22,074,993

97,491,850

At 31 March

1,019,766,481

997,691,488

Of the issued 25p ordinary shares, 169,990 shares were held in the ESOP trust (2013: 275,497), 11,266,245 shares were held as treasury shares (2013: 11,266,245) and 1,008,330,246 shares were in free issue (2013: 986,149,746). No treasury shares were acquired by the ESOP trust during the year. All issued shares are fully paid.

Hedging and translation reserve

The hedging and translation reserve comprises the effective portion of the cumulative net change in the fair value of cash flow and foreign currency hedging instruments, as well as all foreign exchange differences arising from the translation of the financial statements of foreign operations. The foreign exchange differences also include the translation of the liabilities that hedge the Company's net investment in a foreign subsidiary.

Revaluation reserve

The revaluation reserve relates to owner-occupied properties and investments in joint ventures and funds.

Merger reserve

This comprises the premium on the share placing in March 2013. No share premium is recorded in the Company's financial statements, through the operation of the merger relief provisions of the Companies Act 2006.

20. Segment Information

Operating segments
The Group allocates resources to investment and asset management according to the sectors it expects to perform over the medium term. Its two principal sectors are currently offices and retail. The Office sector includes residential, as this is often incorporated into Office schemes, and Retail includes leisure, for a similar rationale. The prior year comparatives have been updated to reflect these changes.The relevant revenue, net rental income, operating result, assets and capital expenditure, being the measures of segment revenue, segment result and segment assets used by the management of the business, are set out below. Revenue is derived from the rental of buildings. Operating result is the net of net rental income, fee income and administration expenses. No customer exceeds 10% of the Group's revenues in either year.
Segment Result	Offices		Retail		Other / unallocated		Total
	2014	2013	2014	2013	2014	2013	2014	2013
	£m	£m	£m	£m	£m	£m	£m	£m


Revenue
British Land Group	99	88	235	206	-	-	334	294
Share of joint ventures and funds	84	83	168	171	15	19	267	273
Total	183	171	403	377	15	19	601	567

Net rental income
British Land Group	91	85	222	196	-	-	313	281
Share of joint ventures and funds	81	80	160	165	12	15	253	260
Total	172	165	382	361	12	15	566	541

Operating Result
British Land Group	80	76	218	190	(42)	(42)	256	224
Share of joint ventures and funds	80	80	157	162	10	14	247	256
Total	160	156	375	352	(32)	(28)	503	480

Reconciliation to underlying profit before taxation
							2014	2013
British Land Group							£m	£m
Total Operating Result							503	480
British Land Group net financing costs							(81)	(80)
Share of funds and joint ventures net financing costs							(123)	(126)
Capital and other							811	(14)
Total profit on ordinary activities before tax							1,110	260

Of the total revenues above, £15m (2013: £19m) was derived from outside the UK.

Segment Assets	Offices		Retail		Other / unallocated		Total
	2014	2013	2014	2013	2014	2013	2014	2013
	£m	£m	£m	£m	£m	£m	£m	£m


Property assets
British Land Group	3,082	2,179	4,534	3,373	-	2	7,616	5,554
Share of funds and joint ventures	2,017	1,684	2,928	3,005	89	256	5,034	4,945
Total	5,099	3,863	7,462	6,378	89	258	12,650	10,499

Segment assets
British Land Group	3,036	2,175	4,554	3,393	477	365	8,067	5,933
Share of funds and joint ventures	2,153	1,839	2,997	3,116	98	263	5,248	5,218
Total	5,189	4,014	7,551	6,509	575	628	13,315	11,151

Other assets
British Land Group	-	-	-	-	477	363	477	363
Share of funds and joint ventures	141	155	67	107	9	7	217	269
Total	141	155	67	107	486	370	694	632

Capital expenditure
British Land Group	607	391	1,140	315	-	47	1,747	753
Share of funds and joint ventures	86	109	13	26	29	-	128	135
Total	693	500	1,153	341	29	47	1,875	888


Reconciliation to net assets
							2014	2013
British Land Group							£m	£m

Segment Assets
British Land Group							8,067	5,933
Share of funds and joint ventures							5,248	5,218
Total							13,315	11,151

Share of funds and joint ventures liabilities							(2,536)	(2,882)
Current liabilities							(766)	(320)
Non-current liabilities							(2,896)	(2,262)
Net Assets							7,117	5,687
Other assets include other investments of £262m (2013: £76m), debtors of £41m (2013: £60m), liquid investments of £nil (2013: £nil), cash and short-term deposits of £142m (2013: £135m) and derivatives of £32m (2013: £92m).

Supplementary Disclosures

Table A: SUMMARY INCOME STATEMENT AND BALANCE SHEET

Summary income statement based on proportional consolidation for the year ended 31 March 2014

The following pro forma information is unaudited and does not form part of the consolidated primary statements or the notes thereto. It presents the results of the Group, with its share of the results of joint ventures and funds included on a line by line, i.e. proportional, basis. The underlying profit before taxation and underlying profit after taxation are the same as presented in the consolidated income statement.



	Year ended 31 March 2014					Year ended 31 March 2013
	Group	Joint ventures	Less non-	Proportionally		Group	Joint ventures	Proportionally
		and funds	controlling interests	Consolidated			and funds	Consolidated
	£m	£m	£m	£m		£m	£m	£m

Gross rental income	334	267	(4)	597		294	273	567

Property operating expenses	(21)	(14)	-	(35)		(13)	(13)	(26)

Net rental income	313	253	(4)	562		281	260	541

Administrative expenses	(72)	(6)	-	(78)		(72)	(4)	(76)

Fees & other income	15	-	-	15		15	-	15

Ungeared Income Return	256	247	(4)	499		224	256	480

Net interest	(81)	(123)	2	(202)		(80)	(126)	(206)

Underlying profit before taxation	175	124	(2)	297		144	130	274

Underlying tax	(2)	-	-	(2)		(1)	-	(1)

Underlying profit after taxation	173	124	(2)	295		143	130	273

Underlying earnings per share - diluted basis				29.4	p			30.3	p

Valuation movement				873				26

Other capital & tax (net)*				53				(4)

Capital and other				926				22

Total return				1,221				295

The underlying earnings per share is calculated on underlying profit before taxation of £297m, tax attributable to underlying profits of £2m and 1,004m shares on a diluted basis for the year ended 31 March 2014.

*Includes other comprehensive income, movement in dilution of share options and the movement in items excluded for EPRA NAV.

Supplementary Disclosures (continued)

Table A (continued):


Summary balance sheet based on proportional consolidation as at 31 March 2014
The following pro forma information is unaudited and does not form part of the consolidated primary statements or the notes thereto. It presents the composition of the EPRA net assets of the Group, with its share of the net assets of the joint venture and fund assets and liabilities included on a line-by-line, i.e. proportional, basis and assuming full dilution.



	Group	Share of joint ventures & funds	Less non-controlling interest	Share options	Deferred tax	Mark-to-Market on effective cash flow hedges and related debt adjustments	Head Leases	Valuation surplus on trading properties	EPRA Net assets 2014		EPRA Net assets 2013
	£m	£m	£m	£m	£m	£m	£m	£m	£m		£m

Retail properties	4,554	2,930	(610)	-	-	-	(22)	-	6,852		6,378

Office properties	3,036	2,012	-	-	-	-	(12)	63	5,099		3,863

Other properties	-	89	-	-	-	-	-	-	89		258


Total properties	7,590	5,031	(610)	-	-	-	(34)	63	12,040		10,499

Investments in joint	2,712	(2,712)	-	-	-	-	-	-	-		-
ventures and funds

Other investments	262	(68)	-	-	-	-	-	-	194		53

Other net (liabilities) assets	(266)	(138)	8	39	6	-	34	-	(317)		(319)

Net debt	(3,181)	(2,113)	231	-	-	173	-	-	(4,890)		(4,266)

Net assets	7,117	-	(371)	39	6	173	-	63	7,027		5,967

EPRA NAV per share (note 2)									688	p	596	p

Property segments have been re-presented in line with note 20.




EPRA Net Assets Movement
							Year ended		Year ended
							31 March 2014		31 March 2013
							£m	Pence per share	£m		Pence per share

Opening EPRA NAV							5,967	596	5,381		595


Income return							295	29	273		30

Capital return							926	90	22		2

Dividend paid							(161)	(27)	(202)		(27)

Dilution due to issues of shares							-	-	493		(4)

Closing EPRA NAV							7,027	688	5,967		596

Supplementary Disclosures (continued)

Table B: EPRA PERFORMANCE MEASURES


EPRA Performance measures summary table
		2014			2013
	£m	Pence per share		£m	Pence per share

EPRA Earnings - basic	295	29.5	p	268	29.9	p
- diluted	295	29.4	p	268	29.7	p

EPRA NAV	7,027	688	p	5,967	596	p

EPRA NNNAV	6,700	656	p	5,522	552	p

EPRA Net Initial Yield		4.8	%		5.5	%

EPRA 'topped-up' Net Initial Yield		5.3	%		5.7	%

EPRA Vacancy Rate		5.2	%		3.4	%



Calculation of EPRA earnings and EPRA earnings per share				2014	2013
				£m	£m

Profit for the year after taxation				1,106	284
Exclude:
Group - non-underlying current tax				(5)	(9)
Group - deferred tax				(3)	(16)
Joint ventures and funds - non-underlying current tax				5	(2)
Joint ventures and funds - deferred tax				-	(1)
Group - net valuation movement (including result on disposals)				(615)	(79)
Joint ventures and funds - net valuation movement (including result on disposals)				(258)	62
Amortisation of intangible assets				-	1
Changes in fair value of financial instruments and associated close-out costs				57	28
Non-controlling interest in respect of the above				8	-

EPRA earnings*				295	268

Mark-to-market on / profit on disposal of liquid investments (held for trading assets)				-	(9)
Mark-to-market on convertible bond				-	7
Non-recurring items**				-	7

Underlying earnings				295	273

* Comparatives have been re-presented in line with updated EPRA guidance.
** Non-recurring items for the year ended 31 March 2014 relate to £7m of issue costs for the convertible bond.

				2014	2013
				Number	Number
				million	million

Weighted average number of shares				1,010	907

Adjustment for Treasury shares				(11)	(11)

Adjustment for ESOP shares				-	(1)

Weighted average number of shares (basic)				999	895

Dilutive effect of share options				2	2

Dilutive effect of ESOP shares				3	4

Weighted average number of shares (diluted)				1,004	901


				2014	2013
				Pence	Pence

Earnings per share (basic)				110.7	31.7

Earnings per share (diluted)				110.2	31.5


Underlying earnings per share (diluted)				29.4	30.3

EPRA earnings per share - basic				29.5	29.9
- diluted				29.4	29.7

Supplementary Disclosures (continued)

Table B (continued):

Net assets per share							2014					2013
				£m			Pence per share			£m		Pence per share

Balance sheet net assets				7,117						5,687

Deferred tax arising on revaluation movements				6						14
Mark-to-market on effective cash flow hedges and related debt adjustments				173						198
Dilution effect of share options				39						58
Surplus on trading properties				63						10
Less non-controlling interests				(371)						-
EPRA NAV				7,027			688		p	5,967		596	p

Deferred tax arising on revaluation movements				(6)						(14)
Mark-to-market on effective cash flow hedges and related debt adjustments				(173)						(198)
Mark-to-market on debt				(148)						(233)

EPRA NNNAV				6,700			656		p	5,522		552	p

EPRA NNNAV is the EPRA NAV adjusted to reflect the fair value of the debt and derivatives and to include the deferred taxation on revaluations.





EPRA Net Initial Yield and 'topped-up' Net Initial Yield
				2014						2013
				£m						£m
Investment property - wholly-owned				7,194						5,554
Investment property - share of joint ventures and funds				4,757						4,945
Less developments, residential and land				(1,192)						(1,340)

Completed property portfolio				10,759						9,159
Allowance for estimated purchasers' costs				639						552

Gross up completed property portfolio valuation				11,398						9,711

Annualised cash passing rental income				554						541
Property outgoings				(8)						(11)

Annualised net rents				546						530

Rent expiration of rent-free periods and fixed uplifts*				53						27

'Topped-up' net annualised rent				599						557
EPRA Net Initial Yield				4.8			%			5.5		%
EPRA 'topped-up' Net Initial Yield				5.3			%			5.7		%

Including fixed/minimum uplifts received in lieu of rental growth				26						26

Total 'topped-up' net rents				625						583
Overall 'topped-up' Net Initial Yield				5.5			%			6.0		%

'Topped-up' net annualised rent				599						557
ERV vacant space				33						19
Reversions				(9)						(13)
Total ERV				623						563
Net Reversionary Yield				5.5			%			5.8		%
* The period over which rent-free periods expire is 2 years (2013: 2 years).
The current period above is stated for the UK portfolio only.

Supplementary Disclosures (continued)

Table B (continued):

EPRA Vacancy Rate
				2014						2013
				£m						£m
Annualised potential rental value of vacant premises				33						19
Annualised potential rental value for the completed property portfolio				626						563
EPRA Vacancy Rate				5.2%						3.4%
The current period above is stated for the UK portfolio only.

EPRA Cost Ratios
				2014						2013
				£m						£m
Property outgoings				21						13
Administrative expenses				72						72
Share of joint ventures and funds expenses				20						17
Less:
Performance & management fees (from joint ventures & funds)				(10)						(10)
Other fees and commission				(5)						(5)
Ground rent costs				(2)						(1)

EPRA Costs (including direct vacancy costs) (A)				96						86
Direct vacancy costs				(13)						(14)

EPRA Costs (excluding direct vacancy costs) (B)				83						72

Gross Rental Income less ground rent costs				330						294
Share of joint ventures and funds (GRI less ground rent costs)				265						273

Total Gross Rental Income (C)				595						567

EPRA Cost Ratio (including direct vacancy costs) (A/C)				16.2			%			15.3		%
EPRA Cost Ratio (excluding direct vacancy costs) (B/C)				13.9			%			12.8		%

Overhead and operating expenses capitalised (including share of joint ventures and funds)				-						-


No overhead or operating expenses, including employee costs, are capitalised.

	Supplementary Disclosures (continued)

	Table C: GROSS RENTAL INCOME AND ACCOUNTING RETURN
	Calculation of gross rental income

						Year ended
						31 March		31 March
						2014		2013
						£m		£m


	Rent receivable					574		538
	Spreading of tenant incentives and guaranteed rent increases					23		28
	Surrender premia					4		1

	Gross rental income					601		567




		Year ended				Year ended
		31 March 2014				31 March 2013


	Total accounting return		20.0		%			4.6			%

SUPPLEMENTARY TABLES

(Data includes Group's share of Joint Ventures and Funds)

Portfolio Valuation
At 31 March 2014	Total1		Change %²
	£m	H1	H2	FY
Retail3:
Retail parks	2,767	1.1	2.7	3.7
Superstores	1,321	2.0	0.7	2.8
Shopping centres	1,862	0.3	1.8	2.1
Department stores	564	6.5	11.1	18.3
Leisure	338	2.0	8.4	10.5
Retail	6,852	1.5	2.9	4.4
Offices3:
City	2,038	3.6	8.1	11.8
West End	2,720	6.0	10.0	16.6
Provincial	96	4.0	6.6	10.9
All Offices	4,854	5.0	9.1	14.4
Residential4	245	2.6	13.2	15.4
All Offices & Residential	5,099	4.9	9.3	14.5

Total	11,951	2.8	5.5	8.3
Table shows UK total, excluding assets held in Europe. Total portfolio valuation including Europe of £12.0bn at year end, +8.0% valuation movement.
1 Including Group's share of properties in joint ventures and funds
2 Valuation movement during the period (after taking account of capital expenditure) of properties held at the balance sheet date, including developments (classified by end use), purchases and sales
³ Including developments 4 Stand-alone residential

Portfolio Yield & ERV Movements

At 31 March 2014

ERV

NEY

ERV Growth %1

NEY Yield Compression bps2

£m

Retail:

Retail parks

165

5.7

1.0

0.0

1.0

Superstores

5.1

0.5

0.2

0.7

Shopping centres

112

5.5

0.0

2.3

2.4

Department stores

5.4

0.1

0.2

Leisure

7.7

2.0

2.6

4.6

Retail

392

5.6

0.6

0.9

1.5

Offices:

City

5.3

1.2

6.6

7.93

West End

137

5.1

2.3

4.6

Provincial

6.1

0.0

All Offices

240

5.2

1.7

4.1

5.8

Total

632

5.5

0.9

2.0

3.0

Table shows UK total, excluding assets held in Europe.

1 Like for like (as calculated by IPD)

2 Including notional purchaser's costs

3 City up 4.0% on a like-for-like basis

Total Property Return (as calculated by IPD excluding Europe)
FY to 31 March 2014	Retail		Offices		Total
%	British Land	IPD	British Land	IPD	British Land	IPD
Capital Return	4.6	4.2	15.3	12.9	8.9	7.5
- ERV Growth	1.5	0.0	5.8	4.9	3.0	1.7
- Yield Compression1	26 bps	33 bps	40 bps	52 bps	31 bps	45 bps
Income Return	5.9	5.7	3.5	5.0	4.9	5.7
Total Property Return	10.7	10.1	19.3	18.5	14.2	13.6
1 Net equivalent yield movement

Portfolio Weighting
At 31 March	2013	2014	2014	2014
		(current)	(current)	(pro-forma1)
	%	%	£m	%
Retail:
Retail parks	24.5	23.1	2,767	21.5
Superstores	12.6	11.1	1,321	10.1
Shopping centres	17.6	15.6	1,862	14.4
Department stores	4.6	4.7	564	4.3
Leisure	3.0	2.8	338	2.6
Retail	62.3	57.3	6,852	52.9
Offices:
City	17.1	17.1	2,038	16.9
West End	18.4	22.7	2,720	25.3
Provincial	0.8	0.8	96	1.7
All Offices	36.3	40.6	4,854	43.9
Residential2	1.4	2.1	245	3.2
All Offices & Residential	37.7	42.7	5,099	47.1

Total	100.0	100.0	11,951	100.0
Table shows UK total, excluding assets held in Europe.
1 Pro forma for developments to date at estimated end value (as determined by the Group's external valuers)
2 Stand-alone residential

Portfolio Net Yields1
At 31 March 2014 (excluding developments)	EPRA net initial yield %	EPRA topped up net initial yield %2	Overall topped up net initial yield %3	Net reversionary yield %	Net equivalent yield %
Retail:
Retail parks	5.3	5.6	5.7	5.6	5.7
Superstores	4.9	5.1	5.1	5.0	5.1
Shopping centres	5.3	5.4	5.4	5.6	5.5
Department stores	5.0	5.0	7.1	4.0	5.4
Leisure	7.1	7.1	8.9	5.6	7.7
Retail	5.3	5.5	5.8	5.4	5.6
Offices:
City	5.5	5.8	5.9	6.2	5.3
West End	2.9	4.3	4.4	5.3	5.1
Provincial	6.9	6.9	6.9	5.6	6.1
All Offices	4.0	4.9	5.0	5.6	5.2

Total	4.8	5.3	5.5	5.5	5.5
Table shows UK total, excluding assets held in Europe.
1 Including notional purchaser's costs
2 Including rent contracted from expiry of rent-free periods and fixed uplifts not in lieu of rental growth
3 Including fixed/minimum uplifts (excluded from EPRA definition)

Annualised Rent & Estimated Rental Value (ERV)
At 31 March 2014 (excluding developments)	Annualised rent(valuation basis) £m1	ERV £m	Average rent £psf
At 31 March 2014 (excluding developments)	Total	Total	Contracted2	ERV2
Retail:
Retail parks	157	165	24.5	24.6
Superstores	68	70	21.8	21.6
Shopping centres	104	112	30.2	31.9
Department stores	30	24	13.6	10.9
Leisure	25	21	14.1	11.6
Retail	384	392	22.7	22.4
Offices:
City	88	98	47.5	48.7
West End	76	137	48.4	52.0
Provincial	6	5	27.1	21.9
All Offices	170	240	46.9	49.2
Residential3	3	-
All Offices & Residential	173	240

Total	557	632	26.6	27.7
Table shows UK total, excluding assets held in Europe.
1 Gross rents plus, where rent reviews are outstanding, any increases to ERV (as determined by the Group's external valuers), less any grounds rents payable under head leases, excludes contracted rent subject to rent free and future uplift
2 Office average rent and ERV £psf is based on office space only
3 Stand-alone residential

Gross Rental Income1
(Accounting Basis)	12 mths to 31 March 2014	Annualised as at 31 March 2014
£m	Total	Total
Retail:
Retail parks	150	159
Superstores	72	71
Shopping centres	115	103
Department stores	33	33
Leisure	29	29
Retail	399	395
Offices:
City	89	87
West End	84	93
Provincial	6	6
All Offices	179	186
Residential2	3	3
All Offices & Residential	182	189

Total	581	584
Table shows UK total, excluding assets held in Europe.
1 Gross rental income will differ from annualised rents due to accounting adjustments for fixed & minimum contracted rental uplifts and lease incentives
2 Stand-alone residential

Lease Length & Occupancy
At 31 March 2014	Average lease length yrs		Occupancy rate %
(excluding developments)	To expiry	To break	Occupancy	Occupancy (underlying)1
Retail:
Retail parks	9.1	8.2	96.8	98.3
Superstores	15.0	14.8	100.0	100.0
Shopping centres	9.1	8.1	95.6	97.3
Department stores	26.6	23.3	100.0	100.0
Leisure	20.7	20.7	100.0	100.0
Retail	12.3	11.3	97.4	98.5
Offices:
City	9.1	7.3	96.8	96.9
West End	11.2	9.4	85.7	88.4
Provincial	8.3	8.0	100.0	100.0
All Offices	10.2	8.4	90.5	92.1

Total	11.5	10.3	94.8	96.1
Table shows UK total, excluding assets held in Europe.
1 Including accommodation under offer or subject to asset management

Rent Subject to Lease Break or Expiry
At 31 March	2015	2016	2017	2018	2019	2015-17	2015-19
	£m	£m	£m	£m	£m	£m	£m
Retail:
Retail parks	7	8	6	12	13	21	46
Superstores	-	-	-	-	-	-	-
Shopping centres	8	7	9	9	5	24	38
Department stores	-	-	-	1	-	-	1
Leisure	-	-	-	-	-	-	-
Retail	15	15	15	22	18	45	85
Offices:
City	1	1	19	4	17	21	42
West End	1	4	7	8	10	12	30
Provincial	-	-	-	-	-	-	-
All Offices	2	5	26	12	27	33	72

Total	17	20	41	34	45	78	157
% of contracted rent	2.7%	3.1%	6.5%	5.4%	7.3%	12.4%	25.1%
Potential uplift at current ERV	2	2	4	(2)	1	7	6

Table shows UK total, excluding assets held in Europe

Rent Subject to Open Market Rent Review
12 months to 31 March	2015	2016	2017	2018	2019	2015-17	2015-19
	£m	£m	£m	£m	£m	£m	£m
Retail:
Retail parks	19	18	16	22	25	53	100
Superstores	15	20	5	4	8	40	52
Shopping centres	9	14	14	15	10	37	62
Department stores	2	5	-	-	-	7	7
Leisure	-	-	-	-	-	-	-
Retail	45	57	35	41	43	137	221
Offices:
City	11	14	2	15	14	27	56
West End	6	17	13	13	20	36	69
Provincial	-	6	-	-	-	6	6
All Offices	17	37	15	28	34	69	131

Total	62	94	50	69	77	206	352
Potential uplift at current ERV	2	2	-	-	-	4	4

Table shows UK total, excluding assets held in Europe

Major Holdings
At 31 March 2014	BL Share	Sq ft	Rent	Occupancy	Lease
(excl. developments under construction)	%	'000	£m pa1	rate %2	length yrs3
Broadgate, London EC2	50	3,963	177	96.8	7.2
Regent's Place, London NW1	100	1,589	70	98.3	9.4
Meadowhall Shopping Centre, Sheffield	50	1,448	81	98.0	8.1
Sainsbury's Superstores	52	2,864	68	100.0	15.1
Tesco Superstores	51	2,808	63	100.0	14.7
Paddington Central	100	608	23	94.2	10.1
Teeside Shopping Park, Stockton-on-Tees	100	422	15	98.6	7.0
Drake Circus Shopping Centre, Plymouth	100	414	16	99.2	6.3
Debenhams, Oxford Street	100	363	11	100.0	25.0
10 Portman Square, W1	100	134	5	68.2	12.0
1 Annualised contracted rent including 100% of Joint Ventures & Funds
2 Includes accommodation under offer or subject to asset management
3 Weighted average to first break

Occupiers Representing over 0.5% of Total Contracted Rent
At 31 March 2014	% of contracted rent		% of contracted rent
Tesco plc	7.7	Facebook	0.9
Sainsbury Group	6.0	Asda Group	0.9
Debenhams	5.8	JPMorgan	0.8
UBS AG	3.2	Reed Smith	0.8
Home Retail Group	2.7	C&W Plc (Cable & Wireless plc)	0.8
Kingfisher (B&Q)	2.7	JD Sports	0.8
HM Government	2.5	Gazprom	0.7
Next plc	2.4	Deutsche Bank AG	0.7
Virgin Active	2.0	Mayer Brown	0.7
Arcadia Group	2.0	Hennes	0.7
Spirit Group	1.6	Mothercare	0.6
Alliance Boots	1.6	ICAP Plc	0.6
Herbert Smith	1.4	Pets at Home	0.6
DSG International	1.3	Credit Agricole	0.6
Marks & Spencer Plc	1.3	Carlson (TGI Friday's)	0.6
Royal Bank of Scotland plc	1.2	AstraZeneca	0.6
Hutchison Whampoa	1.1	Nokia	0.6
Aegis Group	1.1	Henderson	0.5
House of Fraser	1.0	Steinhoff	0.5
New Look	1.0	Lewis Trust (River Island)	0.5
SportsDirect	0.9	Aramco	0.5
TJX Cos Inc (TK Maxx)	0.9	Lend Lease	0.5

INVESTMENT ACTIVITY

Acquisitions and Disposals

FY to 31 March 2014			Price (gross)	BL Share	Annual Passing
Acquisitions		Area	£m	£m	Rent £m3
Completed
Paddington Central	Offices	London	470	470	21
Aldgate Place	Residential	London	40	20	-
The Shoreditch Estate1	Mixed Use	London	6	6	-
Hercules Unit Trust unit purchase2	Retail	Various	262	262	16
Sainsbury's superstore portfolio4	Retail	Various	83	83	-
SouthGate Bath (50%)	Retail	South West	202	101	5
Hilden Block, Ealing Broadway Shopping Centre	Retail	London	29	29	2
Tesco Extra, Craigavon	Retail	N Ireland	23	23	1
1-5 Baker Street	Offices	London	22	22	1
Harmsworth Quays, Canada Water	Residential	London	11	11	-
Other			6	6	-
Total			1,154	1,033	46
1 Entered into an option agreement with The City of London Corporation to draw down a development agreement subject to securing revised planning consent on the sites
2 Units purchased over the course of the financial year
3 BL share of net rent topped up for rent frees 4 26% equity interest
FY to 31 March 2014			Price (gross)	BL Share	Annual Passing
Disposals		Area	£m	£m	Rent £m1
Completed
Puerto Venecia, Zaragoza	Retail	Spain	242	121	7
Bon Accord & St Nicholas, Aberdeen	Retail	Scotland	189	94	6
The Triton Building (NEQ) residential	Residential	London	96	96	-
Eastgate Shopping Centre, Basildon	Retail	South East	89	89	7
St James Retail Park, Northampton	Retail	Midlands	53	53	3
St James Retail Park, Dumbarton	Retail	Scotland	46	46	3
PREF, Udine	Retail	Italy	40	26	2
West Cornwall Shopping Park, Hayle	Retail	South West	26	11	1
Marble Arch House residential	Residential	London	17	17	-
6 and 7-9 Eldon St (Princes Trust House)	Offices	London	17	17	1
Marsh Mills Retail Park, Plymouth	Retail	South West	13	13	1
New Century Park land	Offices	Midlands	13	13	-
Other			60	53	3
Exchanged
Cwmbran Retail Park	Retail	Wales	32	32	2
Residential sales	Residential	London	29	29	-
Total			962	710	36
1 BL share of net rent topped up for rent frees

DEVELOPMENT

Recently Completed & Committed Developments
At 31 March 2014	Sector	BL Share	Sq ft	PC Calendar Year	Current Value	Cost to complete	ERV	Pre-let	Resi End Value3
At 31 March 2014		%	'000	PC Calendar Year	£m	£m1	£m2	£m	£m
2010 Programme:
10 - 30 Brock Street, Regents Place4	Mixed Use	100	505	Completed	402	3	20.5	19.1	118
10 Portman Square	Offices	100	134	Completed	183	4	9.8	4.9	-
Marble Arch House5	Mixed Use	100	87	Completed	70	4	4.4	-	19
39 Victoria Street	Offices	100	93	Completed	82	3	5.4	0.0	-
199 Bishopsgate	Offices	50	144	Completed	60	1	3.5	2.0	-
Whiteley Shopping, Fareham	Retail	50	321	Completed	55	0	2.6	2.4	-
Bedford Street	Residential	100	24	Completed	34	1	0.0	0.0	28
Glasgow Fort (Leisure)	Retail	59	46	Completed	11	3	0.7	0.7	-
The Leadenhall Building	Offices	50	605	2014	265	29	18.9	9.0	-
5 Broadgate	Offices	50	710	2015	251	63	19.2	19.2	-
Total 2010 Programme:			2,669		1,413	111	85.0	57.3	165

Recently Committed:
Milton Keynes, Kingston Centre	Retail	50	21	Completed	5	-	0.3	0.3	-
Old Market, Hereford7	Retail	100	305	2014	66	15	4.8	3.9	-
Craven Hill Gardens	Residential	100	25	2014	47	4	-	-	58
Fort Kinnaird, Edinburgh	Retail	29	55	2014	3	3	0.4	0.3	-
Broadgate Circle	Offices	50	45	2014	10	8	1.2	-	-
Broughton Park, Chester	Retail	59	54	2014	3	6	0.6	0.6	-
Whiteley Leisure, Fareham	Retail	50	58	2014	1	6	0.6	0.4	-
Meadowhall Surrounding Land	Retail	50	22	2015	1	3	0.4	0.4	-
Glasgow Fort, M&S & Retail Terrace	Retail	59	112	2015	1	20	1.6	0.7	-
Deepdale, Preston	Retail	29	71	2015	1	4	0.4	0.4	-
Yalding House	Offices	100	29	2015	11	12	1.5	-	-
The Hempel	Residential	100	40	2016	44	26	-	-	92
Aldgate Place, Phase 16	Residential	50	221	2016	16	45	-	-	65
Clarges Mayfair8	Mixed Use	100	195	2017	213	183	5.7	-	449
Total Recently Committed:			1,253		422	335	17.5	7.0	664

Total Committed Under Construction			2,547		933	427	55.3	34.9	664
Data includes Group's share of properties in Joint Ventures & Funds (except area which is shown at 100%)
1 From 1 April 2014 to practical completion (PC)
2 Estimated headline rental value net of rent payable under head leases (excluding tenant incentives)
3 Residential development of which £148m completed or exchanged and a further £16m under offer
4 Includes 126,000 sq ft of residential of which £102m has now sold and completed
5 Includes 10,000 sq ft of residential of which £17m has now sold and completed during the year
6 End value excludes sale of hotel site, receipts of £6m (BL Share)estimated
7 Completed post year end
8 Includes 104,000 sq ft of residential

Near-Term Pipeline
At 31 March 2014	Sector	BL Share	Sq ft	Total Cost	Status
At 31 March 2014	Sector	BL Share	'000	£m1	Status
Blossom Street, Shoreditch	Mixed Use	100	322	164	Pre-submission
5 Kingdom Street2	Offices	100	240	162	Consented
4 Kingdom Street	Offices	100	147	99	Consented
Glasgow Fort (Restaurant & Car Park)	Retail	59	10	5	Consented
Total Near-Term			719	430
1 Total cost including site value 2 210,000 sq ft of which is consented

Medium-Term Pipeline
At 31 March 2014	Sector	BL Share	Sq ft	Status
At 31 March 2014	Sector	BL Share	'000	Status
100 Liverpool Street	Offices	50	512	Pre-submission
Power Court, Luton	Retail	100	149	Pre-submission
Aldgate Place, Phase 2	Residential	50	145	Consented
Drake Circus Leisure	Retail	100	105	Pre-submission
Fort Kinnaird, Edinburgh (Debenhams)	Retail	29	30	Pre-submission
Glasgow Fort (Additional Retail Unit)	Retail	59	30	Consented
Lancaster	Retail	100	300	Pre-submission
Eden Walk Shopping Centre, Kingston	Mixed Use	50	500 - 600	Pre-submission
Surrey Quays	Mixed Use	100	1,500 - 2,000	Pre-submission
Harmsworth Quays	Mixed Use	100	1,000 - 1,500	Pre-submission
Total Medium-Term			4,271 - 5,371

GLOSSARY

Annualised rent is the gross property rent receivable on a cash basis as at the reporting date. Additionally, it includes the external valuers' estimate of additional rent in respect of unsettled rent review, turnover rent and sundry income such as that from car parks and commercialisation, less any ground rents payable under head leases.

Assets under management is the full value of all assets managed by British Land and includes 100% of the value of all joint ventures and funds.

BREEAM(Building Research Establishment Environmental Assessment Method) assesses the sustainability of buildings against a range of criteria.

Capital return is calculated as the change in capital value of the UK portfolio, less any capital expenditure incurred, expressed as a percentage of capital employed over the period, as calculated by IPD. Capital returns are calculated monthly and indexed to provide a return over the relevant period.

Capped rents are subject to a maximum level of uplift at the specified rent reviews as agreed at the time of letting.

Collar rents are subject to a minimum level of uplift at the specified rent reviews as agreed at the time of letting.

Contracted rent is annualised rent adding in rent which is currently subject to a rent free period.

Developer's profit is the profit on cost estimated by the valuers. The developer's profit is typically calculated by the valuers to be a percentage of the estimated total development costs, including land and notional finance costs.

Development uplift is the total increase in the value (after taking account of capital expenditure and capitalised interest) of properties held for development during the period. It also includes any developer's profit recognised by valuers in the period.

Development construction cost is the total cost of construction of a project to completion, excluding site values and finance costs (finance costs are assumed by the valuers at a notional rate of 5.75% per annum).

EPRA is the European Public Real Estate Association, the industry body for European REITs.

EPRA Cost Ratio (including direct vacancy costs) is the ratio of net overheads and operating expenses against gross rental income (with both amounts excluding ground rents payable). Net overheads and operating expenses relate to all administrative and operating expenses including the share of joint ventures' overheads and operating expenses, net of any service fees, recharges or other income specifically intended to cover overhead and property expenses.

EPRA Cost Ratio (excluding direct vacancy costs) is the ratio calculated above, but with direct vacancy costs removed from net overheads and operating expenses balance.

EPRA earnings is the profit after taxation excluding investment and development property revaluations and gains/losses on disposals, changes in the fair value of financial instruments and associated close-out costs and their related taxation.

EPRA NAV per share is EPRA NAV divided by the diluted number of shares at the period end.

EPRA net assets (EPRA NAV) are the balance sheet net assets excluding the mark-to-market on effective cash flow hedges and related debt adjustments and deferred taxation on revaluations.

EPRA net initial yield is the annualised rents generated by the portfolio, after the deduction of an estimate of annual recurring irrecoverable property outgoings, expressed as a percentage of the portfolio valuation (adding notional purchaser's costs), excluding development and residential properties.

EPRA NNNAV is the EPRA NAV adjusted to reflect the fair value of debt and derivatives and to include deferred taxation on revaluations.

EPRA Topped Up Net Initial Yield is the current annualised rent, net of costs, topped up for contracted uplifts, where these are not in lieu of rental growth, expressed as a percentage of capital value, after allowing for notional purchaser's costs.

EPRA vacancy rate is the estimated market rental value (ERV) of vacant space divided by ERV of the whole portfolio, excluding developments and residential property. This is the inverse of the occupancy rate.

Estimated Rental Value (ERV) is the external valuers' opinion as to the open market rent which, on the date of valuation, could reasonably be expected to be obtained on a new letting or rent review of a property.

Fair value movement is accounting adjustment to change the book value of an asset or liability to its market value.

Gearing see loan to value (LTV).

Gross investment activity as measured by our share of acquisitions, sales and investment in committed development.

Gross rental income is the gross accounting rent receivable (quoted either for the period or on an annualised basis) prepared under IFRS which requires that rental income from fixed/minimum guaranteed rent reviews and tenant incentives is spread on a straight-line basis over the entire lease to first break. This can result in income being recognised ahead of cash flow.

Gross Value Added (GVA) provides a snapshot of a company's overall contribution to the UK economy, both directly through activities and indirectly through spending.

Group is The British Land Company PLC and its subsidiaries and excludes its share of joint ventures and funds (where not treated as a subsidiary) on a line-by-line basis (i.e. not proportionally consolidated).

Headline rent is the contracted gross rent receivable which becomes payable after all the tenant incentives in the letting have expired.

IFRS are the International Financial Reporting Standards as adopted by the European Union.

Income return is calculated as net income expressed as a percentage of capital employed over the period, as calculated by IPD. Income returns are calculated monthly and indexed to provide a return over the relevant period.

Interest cover is the number of times net interest payable is covered by underlying profit before net interest payable and taxation.

IPD is Investment Property Databank Ltd which produces an independent benchmark of property returns and British Land UK portfolio returns.

Lettings and lease renewals are divided between short-term (less than two years' lease length) and long-term (more than two years' lease length). Lettings and renewals are compared both to the previous passing rent as at the start of the financial year and the ERV immediately prior to letting. Both comparisons are made on a net effective basis.

Like-for-like ERV growth is the change in ERV over a period on the standing investment properties expressed as a percentage of the ERV at the start of the period. Like-for-like ERV growth is calculated monthly and compounded for the period subject to measurement, as calculated by IPD.

Like-for-like rental income growth is the growth in net rental income on properties owned throughout the current and previous periods under review. This growth rate includes revenue recognition and lease accounting adjustments but excludes properties held for development in either period and properties with guaranteed rent reviews.

Loan to value (LTV) is the ratio of principal value of gross debt less cash, short-term deposits and liquid investments to the aggregate value of properties and investments.

Mark-to-market is the difference between the book value of an asset or liability and its market value.

Multi-channel retailing is the use of a variety of channels in a customer's shopping experience, including research, before a purchase. Such channels include: retail stores, online stores, mobile stores, mobile app stores, telephone sales and any other method of transacting with a customer. Transacting includes browsing, buying, returning as well as pre- and post- sale service.

Net Development Value is the estimated end value of a development project as determined by the external valuers for when the building is completed and fully let (taking into account tenant incentives and notional purchaser's costs). It is based on the valuers view on ERVs, yields, letting voids and rent-frees.

Net effective rent is the contracted gross rent receivable taking into account any rent-free period or other tenant incentive. The incentives are treated as a cost-to-rent and spread over the lease to the earliest termination date.

Net equivalent yield is the weighted average income return (after allowing for notional purchaser's costs) a property will produce based upon the timing of the income received. In accordance with usual practice, the equivalent yields (as determined by the external valuers) assume rent is received annually in arrears.

Net Initial Yield is the current annualised rent, net of costs, expressed as a percentage of capital value, after allowing for notional purchaser's costs.

Net rental income is the rental income receivable in the period after payment of direct property outgoings which typically comprise ground rents payable under head leases, void costs, net service charge expenses and other direct irrecoverable property expenses. Net rental income is quoted on an accounting basis. Net rental income will differ from annualised net cash rents and passing rent due to the effects of income from rent reviews, net property outgoings and accounting adjustments for fixed and minimum contracted rent reviews and lease incentives

Net reversionary yield is the anticipated yield to which the initial yield will rise (or fall) once the rent reaches the estimated rental value.

Occupancy rate is the estimated rental value of let units as a percentage of the total estimated rental value of the portfolio, excluding development properties. It includes accommodation under offer or subject to asset management (where they have been taken back for refurbishment and are not available to let as at the balance sheet date).

Omni-channel retailing is the evolution of multi-channel retailing, but is consent rated more on a seamless approach to the consumer experience through all available shopping channels i.e. mobile internet devices, computers, bricks and mortar, television, radio, direct mail, catalogue, etc.

Over rented is the term used to describe when the contracted rent is above the estimated rental value (ERV).

Overall 'topped-up' net initial yield is the EPRA Net 'topped-up' Initial Yield, adding all contracted uplifts to the annualised rents.

Passing rent is the gross rent, less any ground rent payable under head leases.

Portfolio valuation movement is the increase in value of the portfolio of properties held at the balance sheet date and net sales receipts of those sold during the period, expressed as a percentage of the capital value at the start of the period plus net capital expenditure, capitalised interest and transaction costs.

Property Income Distributions (PIDs) are profits distributed to shareholders which are subject to tax in the hands of the shareholders as property income. PIDs are normally paid net of withholding tax currently at 20% which the REIT pays to the tax authorities on behalf of the shareholder. Certain types of shareholder (i.e. pension funds) are tax exempt and receive PIDs without withholding tax. Property companies also pay out normal dividends, called non-PIDs, which are treated as normal dividends and not subject to withholding tax.

Property valuation is reported by the Group's external valuers. In accordance with usual practice, they report valuations net, after the deduction of the notional purchaser's costs, including stamp duty land tax, agent and legal fees.

Rack rented is the term used to describe when the contracted rent is in line with the estimated rental value (ERV), implying a nil reversion.

Rent-free period see Tenant (or lease) incentives.

Rent reviews take place at intervals agreed in the lease (typically every five years) and their purpose is usually to adjust the rent to the current market level at the review date. For upwards-only rent reviews, the rent will either remain at the same level or increase (if market rents have increased) at the review date.

Rents with fixed and minimum uplifts are either where rents are subject to contracted uplifts at a level agreed at the time of letting; or where the rent is subject to an agreed minimum level of uplift at the specified rent review.

Retail planning consents are separated between A1, A2 and A3 - as set out in The Town and Country Planning (Use Classes) Order 2005. Within the A1 consent category, Open A1 consent grants planning for any type of retail, while Restricted A1 consent places limits on the types of retail that can operate (this is typically a restriction that only bulky goods operators are allowed to trade at that site).

Class	Description	Use for all/any of the following purposes
A1	Shops	Retail sale of goods other than hot food; post office; sale of tickets or as a travel agency; sale of sandwiches or other cold food off the premises; hairdressing; direction of funerals; display of goods for sale; hiring out of domestic or personal goods/articles; the reception of goods to be washed, cleaned or repaired; a retail warehouse club being a retail club where goods are sold, or displayed for sale, only to persons who are members of that club; or as a night club.
	Financial and professional services	Financial services; professional services (other than health or medical); or other services (including betting) appropriate for a shopping area.
D2	Assembly and leisure	Cinemas, music and concert halls, bingo and dance halls (but not night clubs), swimming baths, skating rinks, gymnasiums or area for indoor or outdoor sports and recreations.

Reversion is the increase in rent estimated by the external valuers, where the passing rent is below the estimated rental value. The increases to rent arise on rent reviews and lettings.

Scrip dividend British Land offers its shareholders the opportunity to receive dividends in the form of shares instead of cash. This is known as a Scrip dividend.

Standing Investments are assets which are directly held and not in the course of development.

Tenant (or lease) incentives are incentives offered to occupiers to enter into a lease. Typically this will be an initial rent-free period, or a cash contribution to fit-out. Under accounting rules the value of lease incentives is amortised through the income statement on a straight-line basis to the earliest lease termination date.

TMTstands for technology, media and telecommunications.

The residual site value of a development is calculated as the estimated (net) development value, less development profit, all development construction costs, finance costs (assumed at a notional rate) of a project to completion and notional site acquisition costs. The residual is determined to be the current site value.

Topping out is a traditional construction ceremony to mark the occasion when the structure of the building reaches the highest point.

Total property return is calculated as the change in capital value, less any capital expenditure incurred, plus net income, expressed as a percentage of capital employed over the period, as calculated by IPD.

Total property returns are calculated monthly and indexed to provide a return over the relevant period.

Total return (total accounting return) is the growth in EPRA NAV plus dividends paid, and this can be expressed as a percentage of EPRA NAV per share at the beginning of the period.

Total Shareholder Return is the growth in value of a shareholding over a specified period, assuming dividends are reinvested to purchase additional units of stock.

Total tax contribution is a more comprehensive view of tax contributions than the accountancy-defined tax figure quoted in most financial statements. It comprises taxes and levies paid directly, as well as taxes collected from others which we administered.

Turnover rents is where all or a portion of the rent is linked to the sales or turnover of the occupier.

Under rented is the term used to describe when the contracted rent is below the estimated rental value (ERV), implying a positive reversion.

Underlying earnings per share (EPS) consists of underlying profit after tax divided by the diluted weighted average number of shares in issue during the period.

Underlying profit before tax is the pre-tax EPRA earnings measure with additional Company adjustments. Adjustments include mark-to-market adjustments on, or profits on disposal of, held for trading assets, mark-to- market adjustments on the convertible bond and issue costs of the convertible bond.

Virtual freeholdrepresents a long leasehold tenure for a period of up to 999 years. A 'peppercorn', or nominal, rent is paid annually.

Weighted average debt maturity - each tranche of Group debt is multiplied by the remaining period to its maturity and the result is divided by total Group debt in issue at the period end.

Weighted average interest rateis the Group loan interest and derivative costs per annum at the period end, divided by total Group debt in issue at the period end.

Weighted average unexpired lease term is the average lease term remaining to first break, or expiry, across the portfolio weighted by contracted rental income (including rent-frees). The calculation excludes residential leases and properties allocated as developments.

Yield compressionoccurs when the net equivalent yield of a property decreases, measured in basis points.

Yield on cost is the estimated annual rent of the completed development divided by the total cost of development including site value and finance costs, accruing at a rate of 4% per annum to the point of assumed rent commencement, expressed as a percentage return.

Yield shift is a movement (usually expressed in bps) in the yield of a property asset, or like-for-like portfolio, over a given period.

Yield compression is a commonly-used term for a reduction in yields.

This information is provided by RNS

The company news service from the London Stock Exchange

END

FR USRARSRAVARR

Related Shares:

FTSE 100 Latest

Value8,399.17

Change-4.01