Capital & Regional (CAL) has resumed dividends. The initial payout is small, but nonetheless marks a symbolic turning point for the retail landlord, which entered the property crash with far too much debt and has spent the past half-decade restructuring. It follows the sale last month of two properties within the Mall Fund, a portfolio of second-tier shopping centres the company manages and part-owns. That reduced the fund's loan-to-value ratio to 56 per cent, easing the path towards a crucial refinancing deadline in 2015 and removing a restriction on dividend payments.
The company also announced its first increase in book value in two years. Basic net asset value (NAV) per share rose from 51p at the year-end to 52p as profits from rental income more than offset property write-downs. Valuations were hit last year by retailer bankruptcies, but these seem to have stabilised - just 20 units are now in administration, down from 48 in December.
That also reflects a robust level of new lettings. The company signed 27 new leases during the period and renewed a further 12. Overall, the rents achieved were above those used for valuation purposes, which suggests the properties are not overvalued in the books - a risk in the retail sector. Less encouragingly, occupancy fell slightly from 94.7 per cent last June to 94.3 per cent this June.
Broker Numis Securities expects year-end adjusted NAV of 56p (from 55p at end-June).
CAPITAL & REGIONAL (CAL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 37p | MARKET VALUE: | £129m | |
| TOUCH: | 36.5-37.5p | 12-MONTH HIGH: | 38p | LOW: 21p |
| DIVIDEND YIELD: | 0.7% | TRADING PROPERTIES: | £70.2m | |
| DISCOUNT TO NAV: | 29% | NET DEBT: | 142%* | |
| INVESTMENT PROPERTIES: | £109m* | |||
| Half-year to 30 Jun | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 53.0 | -10.9 | -3.00 | nil |
| 2013 | 52.0 | 4.10 | 1.00 | 0.25 |
| % change | -2 | - | - | - |
Ex-div: 4 Sep Payment: 27 Sep *Includes property and debt held within joint ventures and associated companies (net debt excludes £168m of debt repayments since the period ended) | ||||
