Hammerson is no longer recommending a proposed final dividend for 2019 and has also withdrawn its earnings guidance for 2020 due to COVID-19.
The retail-focused real estate investment trust (REIT) said despite remaining confident in the financial position of the business, it is clear, however, that COVID-19 will have a material impact on the group in 2020.
As a result, it is no longer appropriate to recommend the final dividend for the financial year ended 31 December 2019, it said. The board is also withdrawing its dividend guidance for 2020.
The UK-listed firm said it is too early to ascertain and quantify the impact of the ongoing period of disruption on income, earnings, net assets and cash flows, and as a result “we are suspending all previous guidance”.
Hammerson said it believes that “conserving liquidity is the right decision for the business, and in the long-term interests of shareholders and colleagues”.
At 1320 GMT, Hammerson shares traded 18% lower on the London Stock Exchange, valuing the company at £539.3m (€606.5m).
According to RBC Europe analyst Julian Livingston-Booth, Hammerson’s decision that it is no longer appropriate to pay a final dividend appears consistent with that of peers British Land and Unibail-Rodamco-Westfield.
“Management’s decision to withdraw previous guidance is unsurprising, in our view.
“In terms of the second quarter 2020 rent collected to date, while only 35% of rent billed for UK shopping centres had been collected by the end of last week, we believe further temporary agreements with tenants could increase to 55% on an adjusted basis.”