The UK continues to weigh heavily on the performance of Australian property giant Lend Lease, which on Thursday revealed a 29% drop in operating profit to A$307.5m (£155m) for the year to 30 June.
Bluewater in Kent was the company’s worst-performing retail asset, with the shopping centre’s value falling 30% to £1.3bn. Lend Lease’s 30% stake dropped toA$814m. Its share in income from the centre also fell 8% to A$54m.
Overall, the company, which is involved in building the 2012 Olympic Village, reported writedowns of A$179.3m for the second half.These contributed to a pretax loss of A$733m for the year, compared with a profit of A$310m in 2008.
Revenue totalled A$14.79bn, down 0.7% from A$14.68bn the previous year. Lend Lease said profits in the company’s European divisions fell as a result of the slowdown in Europe, particularly in the UK residential and retail markets.
Group chief executive Steve McCann said: “A key impact on the business over the past 12 months was a lack of transaction activity, which hindered our asset recycling ambitions. However, Lend Lease is not a distressed seller of assets and will only sell assets where we believe this will optimise longer-term shareholder value. We have materially reduced the cost base. The group has very strong liquidity and is well capitalised.This sets up Lend Lease well to take advantage of its leading market positions as the cycle begins to turn.”
