Drop in asset value mars MEPC results

MEPC, the property group, yesterday announced a 14 per cent increase in annual pre-tax profits to pounds 140m but said that a write-down on a Los Angeles shopping mall had reduced its net asset value from 457p to 450p per share.

Investors were disappointed by the fall in the net asset value, resulting in a 12p drop in MEPC's share prices to 440.5p.

James Tuckey, chief executive, said: "We feel very confident about the whole of the profit statement. The only slight disappointment is on the net asset value side." Earnings per share rose 9 per cent to 22.9p and the total dividend was held at 20p.

Mr Tuckey said the drop in the net asset value reflected a marginal fall in values both in the UK and elsewhere. However, he added: "We feel that the performance of our UK portfolio, which accounts for 70 per cent of the group, is indeed where we would have expected it to be."

He said the valuation date for the portfolio was 31 August and there had been more activity and evidence of an improved market since then. "If we redid the valuation for 1 December, we would probably get a different answer."

The other factor which had brought the net asset value down was the pounds 31m write-down on the valuation of Northridge Mall in Los Angeles. The write- down is equivalent to 7.5p per share.

"We are convinced this is a temporary write-down because the centre is still getting back on its feet after the earthquake some three years ago.

"We are quite confident we will get that value back in the next two to three years as the centre re-establishes itself," Mr Tuckey said.

He defended MEPC's decision to give a target net asset value of 690p per share for 2001. "We're sticking our necks out. The portfolio is very, very different from what it was three years ago and what we're trying to do is give shareholders some feel of where we think the performance is going to be in five years' time," he said.

Mr Tuckey said the full impact of the change of strategy in MEPC's portfolio would take time but there would be progress towards the firm's targets each year.

He said there was a much firmer tone to the markets, particularly in Britain over the past few months. Apart from Northridge, the rest of the US portfolio had performed "extremely well".

MEPC plans to keep the lion's share of its portfolio in Britain, with the remainder in the US and Australia. It has wound down its European portfolio and has no plans to go back into continental Europe in the immediate future.

Mr Tuckey said the group was keen to make acquisitions with the proceeds of its European disposals, but there was a shortage of good stock available, particularly in Britain.

While MEPC has resolved to increase the dividend paid to shareholders, Mr Tuckey could not predict when it would be raised, although he pointed out that dividend cover had improved to 1.15 times from 1.05 a year before.

Start your day with The Independent, sign up for daily news emails
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Guru Careers: Communications Exec / PR Exec

£25 - £30K: Guru Careers: We are seeking a highly-motivated and ambitious Comm...

Guru Careers: Pricing Analyst

£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...

Day In a Page

On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific
In this the person to restore our trust in the banks?

In this the person to restore our trust in the banks?

Dame Colette Bowe - interview
When do the creative juices dry up?

When do the creative juices dry up?

David Lodge thinks he knows
The 'Cher moment' happening across fashion just now

Fashion's Cher moment

Ageing beauty will always be more classy than all that booty
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

Health fears over school cancer jab

Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

'I forgive everyone, but I don't forget'

Fifa president Sepp Blatter issues defiant warning to opponents
Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

Weather warning

Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

High hopes for LSD

Meet the volunteer users helping to see if it cures depression and addiction
German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

Saving Private Brandt

A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral