Shares in Songbird Estates (SBD), which owns 69 per cent of office landlord Canary Wharf Group, jumped 8.5 per cent on a very solid set of half-year numbers. Having fallen from 194p to 190p in a disappointing second half last year, adjusted net asset value (NAV) per share bounced back almost 5 per cent to 199p.
Modest valuation movements, magnified by Canary Wharf's heavy debt load, account for the gains. The East London financial district is best known for its offices, but its shops were the star performers of the half, rising 4.3 per cent, in line with rents. Canary Wharf's retail offer is protected from the sector's wider problems by an upmarket positioning and an affluent, almost captive clientele that works in the offices above.
The other strong performer was the development land adjacent to the core site at Wood Wharf, which was marked up to reflect the group's decision to buy out its joint venture partners in January. Canary Wharf has planning consent for a 4.6m sq ft mixed-use scheme, including a lot of housing. But the offices - still the overwhelming majority of Canary Wharf's portfolio - barely budged in value, so the overall gain was only 1.8 per cent.
Peel Hunt expects adjusted NAV to remain flat at 199p per share at the December year-end.
SONGBIRD ESTATES (SBD) | ||||
|---|---|---|---|---|
| ORD PRICE: | 114p | MARKET VALUE: | £872m | |
| TOUCH: | 113-115p | 12-MONTH HIGH: | 123p | LOW: 100p |
| DIVIDEND YIELD: | nil | TRADING PROP: | £563m | |
| DISCOUNT TO NAV: | 20% | |||
| INVESTMENT PROP: | £4.5bn | NET DEBT: | 215% | |
| Half-yearto 30 Jun | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 158 | 97.6 | 11.7 | nil |
| 2012 | 143 | 102.2 | 7.0 | nil |
| % change | -9 | +5 | -40 | - |
