Capital & Regional, the London-listed retail landlord, has said income growth in 2017 enabled a 7.4% increase in total dividend for the year despite recent occupier failures in the UK. The total dividend for 2017 comes to 3.64 pence per share compared to 3.39 pence for 2016.
Reporting its 2017 results, Capital & Regional said IFRS profit came to £22.4 mln, up from a loss of £4.4 mln.
Adjusted profit was up 8.6% to £29.1 mln (€32.6 mln), compared to £26.8 mln for the previous year. Adjusted earnings per share was up 7.3% to 4.10 pence (December 2016: 3.82 pence).
Tenants
Occupancy edged up to 97.3% compared to 95.4% in December 2016, as 79 new lettings and renewals were agreed at an average 10.3% premium to previous rents and an 8.4% premium to estimated rental value. Overall like-for-like net rental income was up 1.9% to £51.6 mln.
Capital & Regional also invested £17.5 mln in 2017 and expects to continued to deploy about £15-25 mln of capital per annum. In total the company has identified more than 50 individual projects totalling over £100 mln which it believes will deliver in aggregate an income return of at least 9%.
The one large investment transaction of the year was the acquisition of the Exchange Centre shopping centre in the southern English town of Ilford from Meyer Bergman. The purchase price came to about €90 mln, reflecting a net initial yield of 6.7%.
Comment
CEO Lawrence Hutchings said: 'This is another strong set of results that provides me with further confidence in our decision to focus on serving the non-discretionary, value and needs based end of consumer demand through our portfolio of community shopping centres. I believe that C&R through our platform, quality portfolio, energy, insight and experience, can redefine and be recognised as the specialist owner/manager, driving strong returns in this high yielding sector. We have confidence that our repositioning programme and rebased affordable occupancy costs allow our retailer customers to trade profitably in these high footfall locations that have proven to be the engine room for their profits.'
He added that the board was fully aware that recent occupier failures present some challenges to short- term results, but said it 'believes that both the momentum we have carried through into 2018 and our strategic asset management masterplans, underpin our objective of delivering annual dividend growth in a range of 5% and 8% over the medium term.'
Image: The Exchange Centre, Ilford
