Capital & Regional, the UK shopping centre owner partly owned by Growthpoint Properties, announced on Thursday August 11 2022, that it would resume paying dividends. The company had been through the worst of the pandemic which saw the UK’s economy locked down, to curb the spread of Coronavirus. Brits, foreign workers and tourists had taken a long time to return to malls.
The group said in a statement via the JSE’s stock exchange news service (Sens), that given the “stabilisation of operating markets, post Covid-19 and continued stabilisation our valuations, together with the substantial progress made in reducing debt, the group is resuming dividend payments”.
Capital & Regional’s board proposed an interim dividend of 2.5 pence per share.
“Our team has had an exceptionally productive six months, both in terms of driving a strong operational performance and return to profitability and in building on the restructuring of The Mall debt facility and capital raise that we completed in November last year,” chief executive Lawrence Hutchings said.
Capital & Regional also sold The Mall Blackburn for £40m, 5% above book value as well as a residential scheme in Walthamstow which was disposed of for £21m. These and other initiatives placed the company on a stronger footing.
The company’s portfolio was refocussed towards malls in London and the south east of the UK.
“These initiatives have also enabled us to reduce debt to a sustainable level, with net loan-to-value on a pro forma basis improving considerably to 40% from 72% a year ago,” said Hutchings.
As many as 55 new lettings and renewals were achieved during the year at a combined average premium of 34.1%. Capital & Regional managed to complete a 25-year lease with the NHS for a new community healthcare centre and the upsizing and relocation of TK Maxx, both at Ilford, East London. Tenant occupancy improved to 93.7% from 92.7% at the end of December 2021. There were 29-million shopper visits during the first six months with footfall up 58% compared with the first half of 2021.
Rent collection was back in line with historic pre-Covid 19 levels, 97.3% of rent collected for the year to date.
Net rental income on investment assets (NRI) increased 23% to £12.2m compared with £9.9m earned in the six months to end-June 2021, driven by improved occupancy and rent collection.
The improvement in NRI flowed through to the group’s adjusted profit line, which increased 87% to £5.8m, compared with £3.1m for the six month to end June 2021.
The value of the group’s investment assets rose 1.7% in the first half of 2022 to £358.5m from £352.4m at the end of December 2021.
Capital & Regional’s net asset value per share rose to 118 pence from 102 pence.