Great Portland beat analysts' forecasts with a 9.2 per cent portfolio revaluation in the year to 31 March. That beat the IPD benchmark capital return of 7.5 per cent - though the group also generated less income than the benchmark, so it was only marginally ahead in total return terms.
Adjusted profits fell 65.5 per cent on last year. That’s mainly because of the ambitious development programme that Great Portland embarked upon 18 months ago, which has involved vacating buildings and taking on more staff and debt. Indeed, net debt increased from £349m to £499m, though gearing still looks modest.
These developments have sapped income - and dividend growth - but boosted net asset value (NAV). They were revalued up 13.7 per cent over the year, outperforming the wider portfolio. £256m-worth of disposals, which were made at an average 10.3 per cent premium to book value last March, also boosted NAV by 7p.
Yet Great Portland was a net buyer last year. Its biggest coup was picking up a vast postal depot just off Oxford Street for £120m. It will become a major redevelopment project when Royal Mail leaves in 2013.
Pending upgrades, broker Investec Securities expects adjusted NAV of 407p for 2013 (2012: 403p).
GREAT PORTLAND ESTATES (GPOR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 390p | MARKET VALUE: | £ 1,219m | |
| TOUCH: | 389-390p | 12M HIGH / LOW | 450p | 305p |
| DIVIDEND YIELD: | 2.2% | TRADING PROP: | nil | |
| DISCOUNT TO NAV: | 3% | |||
| INVESTMENT PROP: | £1.9bn* | NET DEBT: | 40% | |
| Year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 433 | -3.00 | -1.60 | 8.90 |
| 2009 | 234 | -436 | -180 | 9.00 |
| 2010 | 280 | 157 | 55.5 | 8.00 |
| 2011 | 359 | 261 | 83.8 | 8.20 |
| 2012 | 402 | 155 | 50.2 | 8.40 |
| % change | +12 | -41 | -40 | +2 |
Ex-div: 30 May Payment: 10 Jul *Including share of joint ventures | ||||
