It takes hard work to make investment gains in the London commercial property market, says Helical (HLCL) chief executive Gerald Kaye. With the majority of the recovery in the market taking place between 2012 and 2016, returns are down to a more prosaic level. That meant a lower net gain on the sale and the revaluation of its investment properties of £39m during the 12 months to March, down from £94m in the corresponding period. Nevertheless, adjusted EPRA net assets were up 4 per cent to 473p a share.
The commercial property developer and landlord made progress at several sites during the period. In London, refurbishment work on the 43,600 square feet Charterhouse Square building was completed, with half of the office space let at £75 per sq ft. At Barts Square 82 per cent of the 114 residential units in Phase One had exchanged by May this year, at an average £1,570 per sq ft. Gross rental income increased 7 per cent to £49m.
Overall, the group sold 24 investments for a total £159m, generating a net overall profit of £1.4m. However, office buildings at One King Street in Hammersmith and Chart House in EC1 were sold at a net loss of £0.3m. The six retail assets outside London were also sold at a net loss of £2.9m.
Analysts at Stifel expect adjusted net assets of 501p a share at March 2018, up from 473p the previous year.
HELICAL (HLCL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 337.75p | MARKET VALUE: | £399m | |
| TOUCH: | 337.25-338.25p | 12-MONTH HIGH: | 418p | LOW: 228p |
| DIVIDEND YIELD: | 2.5% | TRADING PROP: | £86.7m | |
| DISCOUNT TO NAV: | 23% | |||
| INVESTMENT PROP: | £1bn* | NET DEBT: | 111% | |
| Year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 217 | 5.0 | 5.0 | 5.55 |
| 2014 | 292 | 102 | 75.0 | 6.75 |
| 2015 | 353 | 87.0 | 64.6 | 7.25 |
| 2016 | 425 | 114 | 91.3 | 8.17 |
| 2017 | 437 | 42 | 34.0 | 8.60 |
| % change | +3 | -64 | -63 | +5 |
Ex-div: 22 Jun Payment: 21 Jul *Includes investments in joint ventures | ||||
