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Capital & Regional resilient in face of challenging retail environment

Capital & Regional resilient in face of challenging retail environment – Capital & Regional has announced its full year results to 30 December 2017. Highlights include:

  • Basic and EPRA NAV per share resilient, both at 67p (December 2016: both 68p)
  • Income growth driving 7.4% increase in total 2017 dividend
  • Adjusted Profit up 8.6% to GBP29.1 million (December 2016: GBP26.8 million);
  • Adjusted Earnings per Share up 7.3% to 4.10p (December 2016: 3.82p)
  • IFRS Profit for the period of GBP22.4 million (December 2016: Loss of GBP4.4 million)
  • Like-for-like Net Rental Income up 1.9%
  • 79 new lettings and renewals achieved at an average 10.3% premium to previous rents and an 8.4% premium to ERV.  Passing rent up 3.0% on a like-for-like basis
  • key asset management initiatives at Walthamstow and Wood Green, in particular, which positively impacted income in 2017
  • Occupancy improved to 97.3% (December 2016: 95.4%)
  • Cost efficiencies delivered annual savings of GBP1.2 million, on track for annualised savings of at least GBP1.8 million by end of 2018
  • 7.4% increase in total dividend to 3.64p per share (December 2016: 3.39p)

Community shopping centre strategy

  • Strong progress since launch at Capital Markets Day in December 2017
  • Highly successful implementation of Ilford and Maidstone pilot projects – contributed to 0.5% increase in footfall in second half of 2017, significantly outperforming national index at -2.9%
  • Positive footfall momentum has continued in 2018, portfolio up 3.1% for two months to end of February 2018 compared to national index at -2.9%
  • Strategic asset management masterplans now implemented across portfolio focused on further enhancing and improving our shopping centres’ community offer and trading environments
  • Revised Capex plan with opportunities for over 50 projects across the portfolio totalling over GBP100 million

Robust balance sheet with long term debt security

Group Cost of debt of 3.25% with average debt maturity of 7.3 years

Lawrence Hutchings, chief executive, said:  “This is another strong set of results that provides me with further confidence in our decision to focus on serving the non-discretionary, value and “needs” based end of consumer demand through our portfolio of community shopping centres.  I believe that C&R through our platform, quality portfolio, energy, insight and experience, can redefine and be recognised as the specialist owner/manager, driving strong returns in this high yielding sector.  We have confidence that our repositioning programme and rebased affordable occupancy costs allow our retailer customers to trade profitably in these high footfall locations that have proven to be the engine room for their profits. 

The Board has announced a 7.4% increase in total dividend for 2017 and, while fully aware that recent occupier failures present some challenges to short term results, believes that both the momentum we have carried through into 2018 and our strategic asset management masterplans, underpin our objective of delivering annual dividend growth in a range of 5% and 8% over the medium-term.”

CAL : Capital & Regional resilient in face of challenging retail environment

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