3rd Quarter Results - Part 2

British Land Co PLC 14 February 2006 THE BRITISH LAND COMPANY PLC 3rd QUARTER RESULTS For the three month and nine month periods ended 31 December 2005 Consolidated Income Statement for the three and nine month periods ended 31 December 2005 --- --- Year ended 31 March Three months ended Nine months ended 31 December 2005 31 December 2005 2005 Audited Unaudited Unaudited ---------------------- --------------------- Underlying Capital Underlying Capital pre tax and Total pre tax and Total JV tax JV tax Note Â£m Â£m Â£m Â£m Â£m Â£m 604 Gross rental and related 2 180 180 520 520 -------- income --------- ------- ------- --------- ------ 517 Net rent and related 2 147 147 452 452 income 8 Fees and other income 25 (3) 22 34 (6) 28 158 Funds and joint ventures 7 11 129 140 25 195 220 (see also below) (49) Administrative expenses (18) (18) (54) (54) 610 Net valuation gains 3 420 420 1,016 1,016 (includes profits on disposals) Net financing costs -------- --------- ------- ------- ---------- ------ ------ 28 financing 26 26 57 57 income (354) pre-exceptional (120) (120) (341) (341) financing expenses (180) exceptional -------- item --------- ------- ------- ---------- ------ ------ (506) (94) (94) (284) (284) -------- --------- ------- ------- ---------- ----- ------ 738 Profit on ordinary 71 546 617 173 1,205 1,378 activities before taxation --------- ------- ---------- ------ Taxation credit (expense) -------- ------- ------ 46 current 3 (8) (130) deferred (112) (247) -------- ------- ------ (84) 4 (109) (255) -------- ------- ------ 654 Profit for the period 508 1,123 ======== after taxation ======= ====== Attributable to: -------- ------- ------ 654 Shareholders of the 508 1,123 ======== company ======= ====== 128.5 p Basic earnings per share 5 97.9 p 216.4 p ======== ======= ====== 126.0 p Diluted earnings per 5 97.5 p 216.0 p ======== share ======= ===== --------------------------------------------------------------------------------------------------------------------- Share of results of funds and joint ventures 31 Operating profit pre-tax 11 11 25 25 169 Net valuation gains on 184 184 266 266 property and investments (42) Taxation (55) (55) (71) (71) -------- --------- ------- ------ ------- ---------- ------ 158 11 129 140 25 195 220 ======== ========= ======= ======= ======= ========= ====== Consolidated Balance Sheet 31 March 31 December 30 September 2005 2005 2005 Audited Unaudited Unaudited Â£m Note Â£m Â£m ---- ---- ---- ASSETS --- --- Non-current assets 10,877 Investment properties 6 11,612 11,694 212 Development properties 6 387 304 700 Investments in funds and joint ventures 7 1,251 1,185 153 Other investments 173 171 Intangible assets 69 72 73 Goodwill 180 180 ------- ---------- --------- 12,015 13,672 13,606 ------- ---------- --------- Current assets 36 Trading properties (at cost) 6 42 44 76 Trade and other debtors 83 81 151 Cash and short-term deposits 8 211 144 ------- ---------- --------- 263 336 269 ------- ---------- --------- 12,278 Total assets 14,008 13,875 ------- ---------- --------- LIABILITIES Current liabilities (408) Short-term borrowings and overdrafts 8 (213) (282) (351) Other current liabilities (495) (467) ------- ---------- --------- (759) (708) (749) ------- ---------- --------- Non-current liabilities (5,754) Debentures and loans 8 (6,187) (6,657) (37) Other non-current liabilities (40) (37) (945) Deferred tax liabilities (1,248) (1,133) ------- ---------- --------- (6,736) (7,475) (7,827) ------- ---------- --------- (7,495) Total liabilities (8,183) (8,576) ------- ---------- --------- ------- ------------------------------------- -------- ----- --- ---------- ---- --------- 4,783 Net assets 5,825 5,299 ------- ------------------------------------- -------- ----- --- ---------- ---- --------- EQUITY 130 Share capital 130 130 1,249 Share premium 1,252 1,252 12 Other reserves (8) (28) 3,392 Retained earnings 4,451 3,945 ------- ------------------------------------- -------- ----- --- ---------- ---- --------- 4,783 Total equity attributable to shareholders of the Company 5,825 5,299 ------- ------------------------------------- -------- ----- --- ---------- ---- --------- 1,135 p Adjusted NAV per share: Basic 9 1,398 p 1,263 p ------- ---------- --------- 1,128 p Fully 9 1,390 p 1,256 p ------- diluted ---------- --------- The Adjusted Net Asset Value (Adjusted NAV) per share includes the external valuation surplus on trading and finance lease properties but excludes goodwill, the fair value adjustments for debt and related derivatives and deferred taxation on revaluations and capital allowances. Consolidated Cash Flow Statement for the three and nine month periods ended 31 December 2005 Three months Nine months Year ended ended ended 31 March 31 December 31 December 2005 2005 2005 Audited Unaudited Unaudited Â£m Note Â£m Â£m ---- --- --- 464 Cash generated from operations 10 133 370 (351) Interest paid (84) (264) 10 Interest received 3 9 (10) UK Corporation tax paid (5) (9) (4) Foreign tax paid (2) Dividends received 16 16 Dividends and distributions received 16 from funds and joint ventures 66 71 ----------- ------------- ---------- 125 Net cash inflow from operating activities 129 191 ----------- ------------- ---------- Cash flows from investing activities Purchase of investment properties (509) and development expenditure (80) (185) (98) Purchase of investments (2) (2) 81 Sale of investment properties 562 894 4 Sale of investments (23) Investment in and loans to funds and joint (2) (5) ventures 55 Amounts repaid by funds and joint ventures 17 257 (36) Purchase of subsidiary companies (net of cash (815) acquired) ----------- ------------- ---------- (526) Net cash inflow (outflow) from investing 495 144 ----------- activities ------------- ---------- Cash flows from financing activities 1 Issue of ordinary shares 3 (11) Purchase of ESOP shares (1) (10) (77) Dividends paid (57) 2,081 Issue of Broadgate Estate securitised debt (1,439) Redemption of Broadgate Funding PLC securitised debt Redemption of 135 Bishopsgate Financing Limited (138) securitised debt (649) Repayment of debt acquired with subsidiary (403) companies 614 Decrease (increase) in bank and other (560) 192 borrowings ----------- ------------- ---------- 382 Net cash (outflow) inflow from financing (561) (275) ----------- activities ------------- ---------- (19) Net increase (decrease) in cash and cash 63 60 equivalents Cash and cash equivalents at 166 30 September 2005 and 1 April 2005 144 147 ----------- --- ------------------------------ ------------------ ------------- ----- ---------- 147 Cash and cash equivalents at 31 December 2005 207 207 ----------- --- -------------------------------------------------- ------------- ----- ---------- Cash and cash equivalents consists of: 151 Cash and short-term deposits 211 211 (4) Overdrafts (4) (4) ----------- --- --- ----------------------------- ------ --- ------------- ----- ---------- 147 207 207 ----------- --- --- ----------------------------- ------ --- ------------- ----- ---------- Consolidated statement of changes in equity (unaudited) for the nine months ended 31 December 2005 Share Share Other Retained capital premium reserves earnings Total Â£m Â£m Â£m Â£m Â£m At 1 April 2005 130 1,249 12 3,392 4,783 -------- -------- -------- ------- ------- Profit on ordinary activities after 1,123 1,123 taxation -------- -------- -------- ------- ------- Valuation movements on development properties 57 57 Gains (losses) on cash flow hedges (64) (64) Actuarial loss on pension scheme (3) (3) Tax on items taken direct to equity 2 2 -------- -------- -------- ------- ------- Net income recognised directly in equity (5) (3) (8) Transferred to the Income statement Foreign currency derivatives (16) (16) Cash flow hedges 7 7 Items taken directly to reserves - joint (6) (6) ventures -------- -------- -------- ------- ------- Total recognised income and expense for the period (20) 1,120 1,100 Purchase of ESOP shares (10) (10) Dividends paid (57) (57) Share issues 3 3 Share option awards 6 6 ----------------------------- -------- ---- -------- -------- ------- ------- At 31 December 2005 130 1,252 (8) 4,451 5,825 ----------------------------- -------- ---- -------- -------- ------- ------- Notes to the accounts (unaudited) 1. Basis of preparation The financial information contained in this report does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. The full accounts for the year ended 31 March 2005, which were prepared under UK GAAP and which received an unqualified report from the auditors, and did not contain a statement under s237 (2) or (3) of the Companies Act 1985, have been filed with the Registrar of Companies. The quarterly financial information was approved by the Board on 13 February 2006. The current period financial information presented in this document is unaudited. It has been prepared in accordance with International Financial Reporting Standards ('IFRS') as adopted for use by the European Union and on the basis of the accounting policies set out in the Group's interim financial information for the six months ended 30 September 2005, consistently applied in all material respects. Underlying profit and Capital and JV tax have been prepared on a basis consistent with that of the Interim 2005 results. This is the first quarterly report prepared by British Land. A retrospective valuation was not carried out at 31 December 2004, due to the additional costs and limited benefits involved; accordingly, we have not presented restated IFRS comparatives at 31 December 2004. 2. Gross rental and related income Three months Nine months Year ended ended ended 31 March 31 December 31 December 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- --- --- --- 509 Rent receivable 142 434 40 Spreading of tenant incentives / guaranteed 14 41 increases 8 Surrender premiums 2 10 47 Service charge income 22 35 -------- ---------- --- --------- 604 Gross rental and related 180 520 income (44) Service charge expense (19) (28) (43) Property operating expenses (14) (40) -------- ---- ------------------ -------------- --- --- ---------- --- ----------------- 517 Net rental and related 147 452 -------- ---- income -------------- --- --- ---------- --- ------------------------ 3. Net revaluation gains on property and investments Three months Nine months Year ended ended ended 31 March 31 December 31 December 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- 550 Revaluation of properties 403 922 43 Revaluation of investments 18 17 Gains on property disposals 17 76 -------- ---------- --------- 610 420 1,016 -------- ---------- --------- 4. Taxation Three months Nine months Year ended ended ended 31 March 31 December 31 December 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- Tax charge Current tax (3) UK corporation tax (3) (30%) 2 Foreign tax 2 11 -------- ---------- --------- (1) (1) 11 (45) Adjustments in respect of prior years (2) (3) -------- ---------- --------- (46) Total current tax charge (3) 8 (credit) 130 Deferred tax on income and revaluations 112 247 -------- ---------- --------- 84 Group total taxation (net) 109 255 42 Attributable to funds and joint ventures 55 71 -------- ---- ------------------ -------------- --- --- ---------- --- --------- 126 Total taxation 164 326 -------- ---- ------------------ -------------- --- --- ---------- --- --------- Tax attributable to underlying profits for the three month period ended 31 December 2005 is Â£11m (Nine month period ended 31 December 2005: Â£33m; Year ended 31 March 2005: Â£42m). 5. Basic and diluted earnings per share Nine Three months months Year ended ended ended 31 March 31 December 31 December 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- --- --- --- 654 Earnings 508 1,123 139 Underlying profit after taxation 60 140 m m m --- --- --- 509 Weighted average number of shares in issue 519 519 519 Weighted average fully diluted number of 521 520 shares in issue ----------- --------- -------- Underlying profits are profits adjusted to exclude gains on asset revaluations and disposals and related taxation and the capital allowance effects of IAS 12 where applicable. 6. Investment, development and trading properties Investment, development and trading properties were valued, at the relevant companies' period ends, by external valuers on the basis of open market value, supported by market evidence, in accordance with the Appraisal and Valuation Manual published by The Royal Institution of Chartered Surveyors. 31 30 31 December September March 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- Investment properties 11,612 11,694 10,877 Development properties 387 304 212 Trading properties at cost 42 44 36 -------- --------- -------- Carrying value of properties on Balance sheet 12,041 12,042 11,125 External valuation surplus on trading properties 63 62 57 Head lease (27) (27) (28) liabilities -------- ---- --------- ---- -------- Total British Land Group property portfolio valuation 12,077 12,077 11,154 -------- ---- --------- ---- -------- Share of joint ventures and associates Investment properties 2,702 2,535 1,321 Development properties 4 Trading properties at cost 6 31 25 Finance lease properties 8 8 8 External valuation surplus on trading properties 3 7 2 External valuation surplus on finance lease properties 4 4 4 Head lease (8) (11) (11) liabilities -------- --------- -------- 2,715 2,574 1,353 -------------------------------------- ---- -------- ---- --------- ---- -------- Total property portfolio valuation 14,792 14,651 12,507 -------------------------------------- ---- -------- ---- --------- ---- -------- Less: Group residential properties (290) (294) (282) -------- ---- --------- ---- -------- 14,502 14,357 12,225 -------- ---- --------- ---- -------- Group properties valued at Â£7,604m (30 September 2005: Â£7,363m; 31 March 2005: Â£7,052m) were subject to a security interest and other properties of non-recourse companies amounted to Â£53m (30 September 2005: Â£61m; 31 March 2005: Â£42m). 7. Funds and Joint Ventures British Land's share of profits of funds and joint ventures Three months ended Nine months ended Year ended 31 31 31 March December December 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- 73 Gross rental income 31 79 ----------- ------- -------- 68 Net rental income 29 75 (4) Other expenditure (2) (6) 1 Other income 1 1 (34) Net financing costs (17) (45) ----------- -------- -------- 31 Underlying profit before taxation 11 25 169 Net valuation gains on property and 184 266 ----------- investments -------- -------- 200 Profit on ordinary activities before 195 291 taxation (42) Taxation (current and deferred) (55) (71) ----------- --- ------------------------ ---- --- --------- ---- ------ --- -------- --- --------- 158 Profit on ordinary activities after 140 220 ----------- --- taxation ---- --- --------- ---- ------ --- -------- --- --------- ------------------------ Summary of British Land's share of investments in funds and joint ventures Underlying Underlying profits profits (Three (Nine Gross Gross Net months) months) assets liabilities investment Â£m Â£m Â£m Â£m Â£m ---- ---- --- ---- --- ---- --- ---- Share of funds 5 7 1,439 (728) 711 Share of joint ventures 6 18 1,466 (926) 540 --------- --- --------- ---- ------ --- -------- ----------- Total share of investments 11 25 2,905 (1,654) 1,251 --------- --- --------- ---- ------ --- -------- ----------- The total investment in joint ventures is Â£605m, which also includes Â£65m being City of London Office Unit Trust (CLOUT) and its associated ventures. 8. Net Debt 31 30 31 December September March 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- Securitisations 3,555 3,549 3,544 Debentures 785 786 786 Bank loans and 1,872 2,413 1,664 overdrafts Other bonds and loan notes 188 191 168 --------- -------- --------- Gross debt (includes Â£213m due within one year at 31 December 6,400 6,939 6,162 2005) --------- -------- --------- Interest rate derivatives (liabilities) 107 92 60 Interest rate derivatives (assets) (29) (17) (10) --------- -------- --------- 6,478 7,014 6,212 Cash and short-term deposits (211) (144) (151) ----------- --- ---- ------------------------- ---- --- ---- ---- --------- --- -------- --------- Net debt 6,267 6,870 6,061 ----------- --- ---- ------------------------- ---- --- ---- ---- --------- --- -------- --------- 9. Net Asset Value per share Adjusted Net Assets Â£m ---- Shareholders' funds as shown on balance sheet 5,825 Valuation surplus on trading and finance lease properties 70 IAS12 capital allowances 132 effects Contingent tax on 1,335 revaluation gains Fair value of cashflow hedges, net of deferred tax 74 Goodwill (180) -------------------------------------------- ----- ------- ------ ----------- Adjusted net assets attributable to ordinary shares 7,256 -------------------------------------------- ----- ------- ------ ----------- On exercise of share 43 options -------------------------------------------- ----- ------- ------ ----------- Adjusted fully diluted net assets attributable to ordinary shares 7,299 -------------------------------------------- ----- ------- ------ ----------- At 31 December 2005 1,390 p ----------- At 30 September 2005 1,256 p ----------- At 31 March 2005 1,128 p ----------- At 31 December 2005 there were 519m ordinary shares in issue (30 September 2005: 519m; 31 March 2005: 518m) and 525m fully diluted ordinary shares in issue (30 September 2005: 525m; 31 March 2005: 524m). Triple net asset value (NNNAV) per share at 31 December 2005 is 1,046p (30 September 2005: 960p; 31 March 2005: 904p). NNNAV represents the adjusted fully diluted net assets after deducting the difference between the carrying value and market value of debt and derivatives, net of related deferred tax, of Â£455m (30 September 2005: Â£363m; 31 March 2005: Â£194m) and after deducting contingent tax on revaluation gains of Â£1,335m (30 September 2005: Â£1,170m; 31 March 2005: Â£964m) and contingent tax on trading property gains of Â£19m (30 September 2005: Â£20m; 31 March 2005: Â£17m). 10. Reconciliation of profit on ordinary activities before tax to cash generated from operations Three Nine Year ended months ended months ended 31 March 31 December 31 December 2005 2005 2005 Â£m Â£m Â£m ---- ---- ---- --- --- --- 738 Profit on ordinary activities before tax 617 1,378 1 Depreciation and amortisation 3 6 (609) Net valuation gains on investment property and (420) (1,016) investments (158) Share of profits after tax of funds and (140) (220) joint ventures 326 Net financing costs 94 284 180 Exceptional item (14) Other cashflow items (21) (62) ------------------- --- --------------------------- ----- ---------- ---- -------- 464 Cash generated from operations 133 370 ------------------- --- --------------------------- ----- ---------- ---- -------- Table A --------- Proportional pro-forma summary income statement for the three and nine month periods ended 31 December 2005 The following pro forma information does not form part of the consolidated primary statements or the notes thereto. It shows the results of the group, with funds and joint ventures consolidated on a proportional basis. Three Nine months months Year ended ended ended 31 March 31 December 31 December 2005 2005 2005 Unaudited Unaudited Unaudited Â£m Â£m Â£m ---- --- ---- --- ---- --- --- --- --- --- 630 Gross rental and related income 211 599 ----------- ---------- ---------- 585 Net rent and related income 176 527 9 Fees and other income 26 35 (53) Administrative expenses (20) (60) (360) Net financing costs (111) (329) ----------- ---------- ---------- 181 Underlying profit before tax 71 173 779 Net valuation gains 604 1,282 Amortisation of intangible asset (3) (6) (180) Exceptional item ----------- ---------- ---------- 780 Profit on ordinary activities before 672 1,449 taxation Taxation credit (expense) 36 current (2) (15) (162) deferred (162) (311) ----------- ---------- ---------- (126) (164) (326) ----------- ---------- ---------- 654 Profit for the period after taxation 508 1,123 =========== ========== ========== Table B --------- Pro-forma summary balance sheets based on proportional consolidation The following pro forma information does not form part of the consolidated primary statements or the notes thereto. It shows the adjusted diluted net assets of the group, with funds and joint ventures consolidated on a proportional basis with trading and finance lease properties shown at valuation. Additionally, goodwill is excluded, as are the fair value adjustments for debt and related derivatives and deferred taxation on revaluations and capital allowances 31 March 31 December 30 September 2005 2005 2005 Unaudited Unaudited Unaudited Â£m Â£m Â£m ---- --- ---- --- ---- ASSETS --- --- --- --- 12,132 Commercial properties (including developments) 14,411 14,239 132 Trading and finance lease properties at valuation 126 156 (39) Head lease liabilities (35) (38) ---------- ---------- ---------- 12,225 14,502 14,357 282 Residential properties 290 294 153 Other investments 179 179 Intangible assets 69 72 ---------- ---------- ---------- 12,660 15,040 14,902 ---------- ---------- ---------- LIABILITIES (223) Net current liabilities (281) (280) ---------- ---------- ---------- Non-current liabilities (6,538) Net debt (7,446) (8,026) (9) Other non-current (15) (11) liabilities 23 Deferred tax liabilities 1 10 ---------- ---------- ---------- (6,524) (7,460) (8,027) ---------- ---------- ---------- (6,747) (7,741) (8,307) ---------- ---------- ---------- 5,913 Adjusted diluted net 7,299 6,595 ========== assets ========== ========== ---------- ---- --------------------------------- --- ---------- ----- ---------- 1,128 p Adjusted diluted NAV per share 1,390 p 1,256 p ---------- ---- --------------------------------- --- ---------- ----- ---------- Reconciliation to Consolidated balance sheet 4,783 Consolidated balance sheet net assets under IFRS 5,825 5,299 Elimination of: (73) - goodwill (180) (180) 17 - fair value adjustments of cash flow hedges, net of 74 63 deferred tax 130 - IAS12 capital allowances effects 132 132 963 - deferred tax on contingent gains 1,335 1,170 63 Valuation surplus on trading and finance lease 70 73 properties 30 On exercise of share 43 38 options ---------- ---------- ---------- 5,913 Adjusted diluted net 7,299 6,595 ========== assets ========== ========== This information is provided by RNS The company news service from the London Stock Exchange

Companies

British Land Company (BLND)

Wednesday, 4th December 2024

COMPANIES COVERED:

LGEN ZIG MEGP

Legal & General sees shares soar as demand for annuities outperforms wider market, but ME Group and Zigup both find themselves under pressure despite plenty of positives in respective updates.

Full Archive

UK 100

Latest directors dealings

8 hours ago Alphawave IP Group
8 hours ago Judges Scientific
9 hours ago Alphawave IP Group
9 hours ago Taylor Wimpey
9 hours ago FDM Group (Holdings)

All directors dealings today