British Land has published figures covering the six months ended 30 September 2016. Its EPRA NAV reduced by 3.0% to 891p over this period. Adjusted diluted earnings per share rose 20% to 19.3p helped by a 16.4% increase in its underlying profit before tax to GBP199 million. They say this was driven by like-for-like income growth of 3.4% and reductions in finance and operating costs. A second quarterly dividend of 7.3 pence brings the half year dividend to 14.6 pence (+3.0%).
The portfolio valuation change of -2.8% breaks down as standing investments -2.8% and developments -3.0%. Office and Residential valuation fell by 3.3%, reflecting a 21 bps yield expansion. ERVs were flat +0.1% (+0.5% like-for-like basis). Retail and Leisure valuations fell by 2.4%, reflecting an 18 bps yield expansion and ERV growth +0.9%.
They achieved 769,000 sq ft of lettings and renewals across the portfolio on average 11.6% ahead of ERV, 60% of these after the referendum. This included 68,000 sq ft of Office lettings in the half, including the final vacant floors at The Leadenhall Building and Marble Arch House, achieving new rental highs. They have also seen good interest in the recently completed West End Office developments at Clarges Mayfair and Yalding House which are now over a third let or under offer, all ahead of March ERVs.At the period end the portfolio was 98% let with average lease length of 9 years and high quality, diverse occupier base.
Chris Grigg, Chief Executive said: “We’ve delivered a good set of results with a significant increase in underlying profits reflecting our actions and continued leasing momentum. We’re mindful of future uncertainty but are confident that our secure income streams and strong finances will ensure our business remains resilient. As occupiers become more discerning we expect our high quality portfolio to benefit from increasing polarisation. The evolving environment will be reflected in our tactical decisions, particularly on development where we expect to proceed more cautiously. We have modest speculative development commitments currently, even following our decision to redevelop 100 Liverpool Street. This is a great example of the opportunities within our portfolio which provide a source of future value.”
BLND : British Land NAV down 3%