| Fri 18 Apr 2008, 8:41 | | LBT - Liberty International Plc - Annual general m |
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LBT
LILII
LBT - Liberty International Plc - Annual general meeting statement and trading
update
LIBERTY INTERNATIONAL PLC
(Registration number UK3685527)
ISIN Code: GB0006834344
JSE Code: LBT
Issuer Code: LILI I
LIBERTY INTERNATIONAL PLC
ANNUAL GENERAL MEETING STATEMENT AND TRADING UPDATE
The following is the text of the statement and trading update at today`s Annual
General Meeting.
Sir Robert Finch, Chairman of Liberty International, commented as follows:
"Liberty International has a business of exceptional quality, a high degree of
specialisation on prime retail which constitutes around 90 per cent of our
assets, the benefits of scale and financial strength with a prudent debt to
assets ratio and long-term fixed-rate debt. Our prime UK regional shopping
centres which constitute some 75 per cent of our business continue to
demonstrate their defensive merits with stable and resilient income streams
while other activities including the Covent Garden Estate, Earls Court &
Olympia, the Great Capital Partnership and our international businesses continue
to trade encouragingly. We are confident in the ability of the company to
respond to the more difficult conditions now prevailing in commercial property
and retail markets."
Enquiries
Liberty International PLC
Sir Robert Chairman +44 (0)20 7690 1273
Finch
David Fischel Chief Executive +44 (0)20 7960 1207
Public
Relations:
UK: Michael Sandler, Hudson +44 (0)20 7796 4133
Sandler
Gareth David, +44 (0)20 7457 2020
College Hill Associates
Nicholas Williams, +27 (0)11 447 3030
College Hill Associates
This announcement includes statements that are forward-looking in nature.
Forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
Liberty International PLC to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Any information contained in this announcement on the price at which
shares or other securities in Liberty International PLC have been bought or sold
in the past, or on the yield on such shares or other securities, should not be
relied upon as a guide to future performance.
ANNUAL GENERAL MEETING STATEMENT AND TRADING UPDATE
CAPITAL SHOPPING CENTRES (`CSC`)
CSC`s prime regional shopping centres are demonstrating their stability and
resilience in the more difficult retail market conditions currently being
experienced.
We have continued to conclude lettings with retailers keen to acquire well
configured space in CSC`s prime locations.
Occupancy levels remain high. As at 31 March 2008, the occupancy level was 98.5
per cent, compared with 98.7 per cent at 31 December 2007.
Progress with settlement of 2006 and 2007 rent reviews has continued to be
positive with the bulk of reviews now concluded and at anticipated levels. We
are currently engaged in 2008 reviews which predominantly relate to The Mall at
Cribbs Causeway, Bristol.
The two major regional shopping centre developments under construction are the
967,500 sq.ft. St David`s, Cardiff extension, anchored by the John Lewis
Partnership, opening in Autumn 2009 and the 480,000 sq.ft. redevelopment of
Eldon Square, Newcastle where the largest phase opens in Spring 2010.
At St David`s, Cardiff, lettings continue to progress satisfactorily with over
40 per cent of the space either exchanged or in solicitors` hands (27 per cent
by income). In respect of Eldon Square, over 60 per cent of the largest phase,
the Southern Gateway, is committed by income.
We continue to await the outcome of the CPO inquiry in respect of the Westgate,
Oxford development and are currently reviewing our financing options for this
project following the rearrangement of the partnership structure in 2007 which
increased our participation in the project.
We are actively engaged on a considerable number of active management and
expansion projects across the CSC centres notably at The Glades, Bromley;
MetroCentre, Gateshead; Braehead, Glasgow and Cribbs Causeway, Bristol.
CAPITAL & COUNTIES
Capital & Counties has had a good start to 2008.
We are progressively implementing our masterplan for the GBP650 million Covent
Garden Estate.
The Great Capital Partnership, our GBP650 million joint venture with Great
Portland Estates, has reported a substantial and positive restructuring with The
Crown Estate involving over GBP350 million of assets. The partnership has also
concluded a GBP225 million non-recourse secured loan maturing in 2013 to
refinance the partners` equity investment in the joint venture and also provide
financial resources for asset repositioning and investment projects.
The Earls Court & Olympia business is trading well and we are actively pursuing
the opportunity to intensify use at these locations.
Under our disposal programme for non-core assets held by Capco Urban and Capco
Opportunities, we have concluded GBP45 million of disposals to date in 2008 at a
surplus of GBP1.6 million over 31 December 2007 book values.
In the USA, our business is performing very satisfactorily and we have recorded
a $10 million disposal of a non-core asset.
PROPERTY VALUATIONS AND NET ASSET VALUE ESTIMATE
We noted on 13 February 2008 when announcing Liberty International`s 2007 annual
results that upward pressure on commercial property valuation yields had
continued into 2008.
The group`s first quarter results to 31 March 2008 containing full details of
property valuations are scheduled to be formally released on 7 May 2008.
In respect of UK regional shopping centres, which comprised 75 per cent of
Liberty International`s aggregate GBP8.6 billion of investment properties at 31
December 2007, valuation yields (which averaged 5.07 per cent at the year end)
have increased by approximately 25 basis points in the quarter, reducing UK
shopping centre valuations by around 4.5 per cent.
In respect of the remaining 25 per cent of the group`s assets held by Capital &
Counties, the overall reduction in valuations in the first quarter has been a
more modest 2.3 per cent.
In aggregate, taking valuation movements and other factors into account,
adjusted net asset value per share is expected to reduce from 1264p at 31
December 2007 to around 1180p at 31 March 2008.
Although shareholders buying our shares only pay stamp duty at 0.5 per cent on
share transactions, the assumption contained within the valuations is that our
assets would be sold individually to purchasers who would pay the full 4 per
cent stamp duty land tax applicable to large property transactions and other
notional acquisition costs. This factor would have increased net asset value at
31 March 2008 by around GBP375 million, representing around 100p per share over
and above adjusted net asset value per share (31 December 2007 - 104p per share
over the published figure of 1264p per share).
FINANCING
Liberty International has a strong financial position with unutilised committed
financial facilities at 31 March 2008 of GBP510 million and cash balances over
GBP130 million, substantially in excess of our commitments.
The group`s debt structure is robust with predominantly fixed-rate, asset-
specific and non-recourse financing with no significant maturities before 2011.
UK PROPERTY MARKET
In the view of the directors of Liberty International, further upward movement
in valuation yields may well be experienced in 2008 as investment property
markets remain unsettled in the light of ongoing uncertainty in financial
markets and the general tightening of credit conditions. It is currently too
early to assess the full impact of these factors on the general performance of
the UK economy and specifically for the property industry. In particular,
rental levels are likely in the next few years to become an increasingly
important factor in valuation performance.
The directors believe that Liberty International`s continued focus on
predominantly retail assets of the highest quality positions the company well in
the more difficult real estate market conditions now prevailing.
18 April 2008
Notes to Editors:
LIBERTY INTERNATIONAL PLC is the UK`s third largest listed property company and
a constituent of the FTSE-100 Index of the UK`s leading listed companies.
Liberty International converted into a UK Real Estate Investment Trust (REIT) on
1 January 2007.
Liberty International owns 100 per cent of both Capital Shopping Centres
("CSC"), the premier UK regional shopping centre business, and Capital &
Counties, a retail and commercial property investment and development company.
At 31 December 2007, Liberty International owned GBP8.6 billion of properties of
which UK regional shopping centres comprised 75 per cent and retail property in
aggregate 88 per cent. Shareholders` funds and minority interests amounted to
GBP4.7 billion. Assets of the group under control or joint control amounted to
GBP11.0 billion at that date.
CAPITAL SHOPPING CENTRES has interests in 14 UK regional shopping centres
amounting to 12.6 million sq.ft. in aggregate including 8 of the UK`s top 21
regional shopping centres with a market value of GBP6.5 billion at 31 December
2007. CSC`s largest centres are Lakeside, Thurrock; MetroCentre, Gateshead;
Braehead, Renfrew, Glasgow; The Harlequin, Watford; and Manchester Arndale. In
addition, CSC has three major development projects in progress or with planning
permission in Cardiff, Newcastle and Oxford.
CAPITAL & COUNTIES owned assets of GBP2.2 billion at 31 December 2007 amounting
to 7.2 million sq.ft. in aggregate. Capital & Counties had GBP664 million
invested in the Covent Garden area including the historic Covent Garden Market,
and GBP353 million in Central London, primarily through the Great Capital
Partnership, a joint venture with Great Portland Estates plc. Capital & Counties
acquired 50 per cent of EC&O Venues (Earls Court and Olympia Group) in 2007 for
a sum that valued the assets at approximately GBP375 million. In addition,
Capital & Counties has interests in the USA amounting to GBP381 million (2.7
million sq.ft.), predominantly comprising retail assets in California, including
the 856,000 sq.ft. Serramonte Shopping Centre, Daly City, San Francisco.
Date: 18/04/2008 08:41:48 Produced by the JSE SENS Department.
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