Net assets at the end of the year were 183p a share, down 19 per cent on last time, compared with worst City forecasts of about 189p. Overall, the value of its investment property, excluding exchange differences, fell 9 per cent, but it also provided pounds 16.5m against the value of its development portfolio. That has been taken to the revaluation reserve as the diminution is not expected to be permanent.
Douglas Garner, managing director - who takes over from Henry Axton, the chairman, in June - said the worst falls were in Brixton Estate's Holborn properties, which dropped 15 per cent, reflecting a halving in rents since the market's peak. But he said he expected a 'modest pick-up' in overall asset values this year.
Pre-tax profits rose 4 per cent to pounds 28.5m, on the back of a 9 per cent rise in rental income to pounds 55.2m. Earnings, helped by a lower tax charge, rose 9.7 per cent to 13.86p and the dividend was increased to 8.35 after a 3p (2.9p) final.
Debt rose from pounds 323.2m to pounds 348m which, with the drop in assets, pushed gearing up from 87 to 114 per cent. Interest charged to profits rose by a fifth to pounds 24m.
A fellow property company, Stanhope, has warned that its net assets are likely to decline further in the year to June, on top of the 90 per cent drop to pounds 42.2m suffered last year. The fall will largely be due to delays in letting Ludgate and 199 Bishopsgate, both in the City.
Stanhope added that its recovery was 'in large measure dependent upon increasing values at Broadgate' - which is let but for 199 Bishopsgate. Stuart Lipton, chief executive, said he believed that the value of Broadgate was well-supported.
The group revealed an unchanged pounds 15.4m pre-tax loss for the six months to December.
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