Supermarket developer LXB Retail (LXB) has sold three of its schemes in Greenwich, south east London, and is in the process of selling a fourth. In aggregate, the prices achieved give a surplus over cost of £41m - or 26.5 per cent. With their long leases and blue-chip tenants, supermarket sheds remain extremely popular with institutional investors.
Assuming they go ahead, these deals should release substantial cash before the September year-end, paving the way for a capital return of up to £103m. Management also expects to sell the group's remaining retail projects before next year's continuation vote, which will mark the fifth anniversary of the company's flotation on the Alternative Investment Market (October 2009). That will leave just two larger-scale mixed-use developments in Ayr and Truro on the balance sheet.
Progress on planning and lettings over the six months to end-March pushed adjusted book value per share up 4.6 per cent to 117p, based on valuation estimates by Jones Lang LaSalle. For all the Tory talk of cutting red tape, management says the planning environment remains painfully slow. Alongside the shortage of bank finance, that's keeping a tight lid on retail development - making the company's schemes desirable to retailers and investors, despite the soggy climate for consumer spending.
LXB RETAIL PROPERTIES (LXB) | ||||
|---|---|---|---|---|
| ORD PRICE: | 118p | MARKET VALUE: | £275m | |
| TOUCH: | 114-118p | 12-MONTH HIGH: | 123p | LOW: 105p |
| DIVIDEND YIELD: | nil | TRADING PROP: | nil | |
| PREMIUM TO NAV: | 2% | |||
| INVESTMENT PROP: | £241m | NET DEBT: | 1% | |
| Half-year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 111 | 8.7 | 3.39 | nil |
| 2013 | 116 | 11.1 | 4.31 | nil |
| % change | +4 | +27 | +27 | - |
Ex-div: - Payment: - | ||||
