Shaftesbury's chief executive Jonathan Lane has announced he is to retire in 2011, but will remain on the board as deputy chairman following 24 years at the helm of the West End property specialist.
Shaftesbury's retail-dominant portfolio increased in value by 14.2 per cent over the year, boosting the company's net asset value (NAV) by 20 per cent. By far the strongest performer was Longmartin, a joint retail development with the Mercers company in Covent Garden, which recorded a valuation boost of nearly 40 per cent as pre-lets hit 81 per cent. This will add £4m to the rent roll when complete.
Rental income increased by 6.5 per cent to £65.7m, excluding the impact of incentives, but property outgoings rose from £0.9m to £8m in a year, due to shops being empty in Carnaby Street to reconfigure into larger units.In the year, Shaftesbury spent £65m acquiring properties, and management report more assets are becoming available to buy. Its properties in Berwick Street, a new target area for acquisitions, rose in value by 17 per cent.
Broker Execution Noble forecasts 2011 adjusted NAV of 446p and a 10 per cent hike in the dividend to 11.3p.
|ORD PRICE:||435p||MARKET VALUE:||£988m|
|TOUCH:||432-435p||12-MONTH HIGH:||465p||LOW: 348p|
|DIVIDEND YIELD:||2.4%||TRADING STOCK:||nil|
|PREMIUM TO NAV:||14%|
|INVEST PROPERTIES:||£1.48bn||NET DEBT:||60%|
|Year to 30 Sep||Net asset value (p)||Pre-tax profit (£m)||Earnings per share (p)||Dividend per share (p)|
*NAV and earnings adjusted to reflect 2009 rights issue
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Shaftesbury's unique portfolio has withstood valuation shocks, and new lettings demonstrate the pulling power of the West End for foreign shoppers. Its shares trade in line with forward NAV, but future dividend growth means we continue to rate them good value.
Last IC view: Good value, 362p, 28 May 2010