Shopping centre specialist Liberty International has posted a fall in profit before tax to £130.1m for the year ended 30th June, compared to £277.3m last year in its first interim results with Sir Robert Finch as chairman.
The company blames the fall on the “£114.3m decrease in the fair value of derivative financial instruments”, resulting from “Liberty International predominantly financing itself by floating rate debt with interest rate exposure reduced by interest rate swaps.”
It adds that “substantially all interest payments on existing debt and in respect of committed capital expenditure are fixed for the next ten years”, and emphasised that underlying profit before tax excluding valuation items, exceptionals and trading profits rose to £53.8m from £50.6m.
Liberty International’s holdings and rental incomes continued to increase, however. IFRS net assets increased to £2.59bn from £2.53bn, meaning net assets per share rose from 1025p to 1085p. Net rental income also increased by £18.8m to £143.8m.
The company highlighted the increase in investment and development properties from £5.3bn to £6.2bn, and the £653m acquisition of interests in Manchester’s Arndale Centre and Bristol’s Cribbs Causeway.
Chairman Sir Robert Finch said that the results showed the company to be “in vibrant good health with a portfolio of first class assets, the market leadership in the UK’s regional shopping centre industry, a promising development programme and a skilled and experienced management team at all levels.”
He added: “These are the first results we have produced under IFRS which change the presentation and format of the Interim Results; however they have no impact on the cash flows of the business or its present strategic direction.”
“Looking at the underlying picture, we have extended our track record of consistent growth and, with a further positive revaluation in the period, the aggregate value of our property investments has increased from £5.3bn to £6.2bn.”
However, earnings per share have fallen from 13.3p to 13.9, as a result of “lower trading profits in the first half of 2005 of £0.6m”, compared to £6.8m in the first six months of 2004. But Liberty expects “further trading profits” in the second half of this year.
References: EGi News 28/07/05
