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Hammerson holds up well despite Brexit vote

The retail landlord saw good growth in the value of its premium outlets
February 21, 2017

Property company Hammerson 's (HMSO) overseas property and premium retail assets have served as a buffer against the impact of Brexit vote-related volatility, but inevitably it hasn't been able to avoid harm altogether. Revaluation losses of £25m compared with gains of £245m in the prior period, slashing pre-tax profits. But overall, the adjusted net asset value was up 4 per cent to 739p by the end of the period, helped by the revaluation of its non-sterling assets.

IC TIP: Hold at 579.5p

In capital terms, the group's UK shopping centres and retail outlets both fell in the year, held back by wider market forces as open-ended property funds rushed to sell in the wake of the referendum vote. However, its luxury brand-focused premium outlets and French properties buoyed the portfolio to deliver an overall increase of 1.1 per cent. These represent 17 per cent and 22 per cent of the overall portfolio, respectively, with scope for the premium segment to grow to around a fifth of the portfolio in the next few years. Management hopes this should make for a resilient portfolio as tourists, encouraged by the weaker pound, flock to luxury outlets.

Analysts at Peel Hunt now forecast adjusted net assets per share of 745p by the year-end, up from 739p a year earler.

 

HAMMERSON (HMSO)
ORD PRICE:579.5pMARKET VALUE:£4.6bn
TOUCH:579-579.5p12-MONTH HIGH:605pLOW: 400p
DIVIDEND YIELD:4.1%DEVELOPMENT PROP:£397m
DISCOUNT TO NAV:20%
INVESTMENT PROP:£7.9bn*NET DEBT:58%

Year to 31 DecNet asset value (p)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
201254094.012.617.7
201357032645.319.1
201463470395.720.4
201570373292.822.3
201672832340.224.0
% change+4-56-57+8

Ex-div: 16 Mar

Payment: 17 Apr

*Includes £3.74bn investment in joint ventures.