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The Investment column: Land Securities

The Investment Column
LAND SECURITIES, Europe's biggest property company, yesterday reported a 10 per cent increase in pre-tax profit but attracted criticism for being too conservative. However, the company remains attractive to investors concerned that the stock market bubble could burst in the near future.

The shares closed up 18.5p at 822p as the pounds 7bn group unveiled annual pre-tax profits of pounds 293m, at the top end of analysts estimates. Net assets grew from pounds 5bn to pounds 5.5bn. LC revealed a pounds 1.1bn development programme. The move follows criticism that LC, which has underperformed the property sector in the last year, has an overcapitalised balance sheet. Some analysts would like the group to increase its borrowings, currently at pounds 1.5bn, and spend pounds 3bn on developments. However, chief executive Ian Henderson says more development lies ahead.

Carl Gough, property analyst at Commerzbank, says Land Securities should outperform the market by 10 per cent this year. He has upgraded his net asset value forecast for 2000 from 975p to 1015p. With property a safe haven when equity markets tumble, Land Securities is looking good value.