Emerging markets property developer Plaza Centres has swung into the red, posting a pretax loss of €11.2m for the first half of the year.
The company said the net loss, which is down from a profit of €32.4m at the end of June last year, said the loss arose from finance costs of €12.9m during the period.
The company, which invests and develops property in Central and Eastern Europe, India and the US, also delivered a basic and diluted loss per share of €0.02, compared with a profit of €0.11 at the end of June 2011.
Group revenue rose 42% to €33.7m in the six-month period as the result of higher rental income derived from an increased number of shopping malls operating throughout the period.
Total assets shrunk to €1.14m from €1.3bn at the end of last year, driven by the sale of 47 out 49 assets within its US portfolio.
Plaza said it had reduced its gearing with debt comprising 53% of its balance sheet, down from 59% at the end of last year, due to bond buybacks and US exit.
Plaza Centers president and chief executive Ran Shtarkman said: “Despite challenging market conditions, Plaza has again delivered strong results for the reporting period with a 42% increase in our revenues from operations resulting from the increased number of completed shopping centres we operate and hold on our balance sheet.
“Combined with our robust financial performance, we have also been able to achieve a number of firsts for our development programme including the highly successful launch of our first shopping and entertainment centre in Serbia, Kragujevac Plaza, which has been enormously well received by the local population.
“We also completed our first shopping centre in India, Koregaon Park Plaza in Pune, and were highly encouraged by the success of the soft opening.
“With no imminent end to the eurozone crisis, we remain vigilant to the potential risks to our business. However, by de-risking our development programme, maintaining a strong cash balance and working capital reserves alongside reducing our levels of gearing, Plaza is strongly positioned to weather these uncertainties and continue to deliver growth.”
bridget.o’connell@estatesgazette.com
