Capital and Regional defers dividend as Growthpoint circles

print

Capital and Regional defers dividend as Growthpoint circles

Published Date: 2019-09-12 | Source: Stephen Gunnion | Author: Stephen Gunnion

Capital and Regional defers dividend as Growthpoint circles

The shopping centre owner reported a first-half loss due to a fall in property valuations, driven by negative sentiment towards the sector.

Capital & Regional has unveiled a potential investment by Growthpoint Properties as it tries to strengthen its balance sheet and boost liquidity following a decline in the value of its shopping centres.

Releasing interim results yesterday, the UK-focused real estate investment trust (REIT) said it was in talks with Growthpoint, which would potentially take a majority stake and inject capital to support its strategy. As a result, it's deiced to defer a decision on the level of its interim dividend until the process has concluded.

Contracted rent declined by 1.9% to £61.1 million in the six months to end-June as new letting activity partially offset the impact of retailers entering company voluntary arrangements (CVA) and administration. Net rental income fell 3.1% to £25.2 million and adjusted profit was 4.5% lower at £14.8 million. Under International Financial Reporting Standards methodology, it reported a £55.4 million loss for the period due primarily to a fall in property valuations, driven by negative sentiment towards retail assets and the income impact of the CVAs.

However, the group said occupancy levels remained steady at 96.8% and its three shopping centres in London increased footfall marginally. There were 37.2 million visits across its wider portfolio, reflecting a decline of 1.8%. This was ahead of the national index, which was down by 3.6%.

Capital & Regional's shares jumped 7.4% to R3.33 yesterday while Growthpoint declined 2.6% to R22.88.





Similar Stories