Final Results - Year Ended 31 Dec 1999, Part 2
Hammerson PLC
6 March 2000
PART TWO
RETAIL SECTOR REVIEW
Retail Markets
- In the UK, consumer confidence rose steadily during 1999 accompanied by
strong retail demand in certain sectors. However, in the clothing and
footwear sectors, which are important components of the product offer of
a shopping centre, volume increases have been accompanied by pressure on
margins. Nevertheless, demand for space from retailers, both domestic
and international, remains healthy for regional malls, out-of-town
centres and larger city centres. Investment demand for shopping centres
remained very strong in 1999 and this resulted in an increase in values.
- In France, consumer confidence grew strongly during 1999. Tenant demand
remained good, especially for larger retail units in prime streets and
shopping centres, and rents increased by approximately 10% during the
year. As in the UK, investor demand for shopping centres in France
remained buoyant and values increased.
- In Germany, economic growth remained modest in 1999, although an increase
in demand in some prime retail areas is beginning to show through in
stronger rental growth. The outlook is improving in line with better
economic forecasts and in the context of the relatively low supply of
large prime units. Investor interest in shopping centres remains strong,
particularly from domestic institutions.
Shopping Centres - Investment Portfolio
- At 31 December 1999 the group owned, or held substantial interests in, 14
major shopping centres. Its retail investments were valued at £1,319
million, and provide a total of 575,000 sq m of accommodation. In
addition, the group had interests in retail development properties with a
cost of £241 million and a market value of £266 million.
- In July 1999, Hammerson purchased a further 49.5% interest in the Liberty
Centre, Romford for £53 million, increasing its ownership to 99.5%. The
group is currently evaluating a possible expansion and refurbishment
programme at the centre, which continues to trade very well.
- Two shopping centres, where the future growth prospects appeared limited,
were sold during 1999 - Saar Galerie in Saarbruecken for £18 million
and Wolsey Place in Woking for £46 million.
- In September, the development of The Oracle Shopping Centre in Reading
was completed and opened almost fully let. Retailers are reporting
encouraging trading levels. A further phase of works, to link the scheme
to Reading's existing prime retail street, is now underway with
completion scheduled for autumn this year.
- Reflecting the generally favourable conditions in each of the group's
retail property markets in 1999, there was an underlying increase in the
value of the shopping centre investment portfolio, excluding The Oracle,
of 7.9%. Slightly over half this increase resulted from favourable yield
movements and the balance from higher rental values.
- On a like-for-like basis, net rental income from the group's retail
portfolio rose by 6.6% in 1999, reflecting good occupational demand.
- The total returns from the group's retail investment portfolio, excluding
The Oracle, Reading, are summarised below:
Retail Underlying Income Total
portfolio valuation return return
movement % % %
UK 7.4 5.5 12.9
France 11.7 6.3 18.0
Germany 2.4 5.6 8.0
Total 7.9 5.7 13.6
- The group's income remains of high quality. At 31 December 1999, the
retail portfolio was 16% reversionary overall and the vacancy was 2.5%.
Retail Net rental Reversionary Vacancy Unexpired
portfolio income % % lease
£m terms
years
UK 39.3 14 0.9 14
France 18.8 25 2.8 6
Germany 7.9 11 6.5 6
Total 66.0 16 2.5 11
- During 1999, the group's ten largest retail tenants, measured by gross
rental income, accounted for 20% of total rental income from the retail
portfolio. The monitoring and management of the exposures to individual
tenants is a key part of the group's asset management activities.
- Hammerson is currently advancing expansion or improvement programmes at
several shopping centres. In the UK these include Brent Cross, where the
result of a public inquiry into a proposed 27,000 sq m expansion is
expected this year, and Liberty Centre in Romford. Overseas they include
Italie 2 in Paris 13eme, Place des Halles in Strasbourg and Maerkisches
Zentrum in Berlin.
- Since the year end, Hammerson has completed the purchase of Forum
Steglitz, a 22,000 sq m shopping centre in a prosperous suburb of
Berlin, for £80 million. The centre offers good potential for rental
growth and a refurbishment programme to further boost returns is being
reviewed. The group has also exchanged contracts to acquire Les Trois
Quartiers, 21 boulevard de la Madeleine, a 28,500 sq m mixed use
retail and office property, in a prime central Paris location, for £122
million.
Shopping Centres - Developments
- At 31 December 1999, Hammerson had interests in five major retail
development projects. The group's share of the additional costs,
including interest, of completing these projects was approximately £200
million, of which £90 million is anticipated to be incurred in 2000 and
£30 million in 2001.
Project Description Total Ownership Completion
development Interest date
cost*
B5 Designer Outlet Designer outlet £15 m 50% May 2000
Center, Berlin centre of 12,000 m2
West Quay, Regional shopping £170 m 50% Sept 2000
Southampton of 70,600 m2
54 boulevard Retail/office £73 m 100% Oct 2000
Haussmann,
Paris 9eme building of 12,700 m2
Martineau Place Retail shop units £25 m 33 1/3% July 2001
Birmingham totalling 16,700 m2
The New Bull Ring Regional shopping £150 m 33 1/3% Sept 2003
Birmingham of 110,000 m2
* costs shown in respect of joint ventures represent Hammerson's share
- At West Quay in Southampton, leases representing 65% of the scheme's
estimated total rent roll have now been exchanged or are in solicitor's
hands and a further 10% is under offer. At the other major project to be
completed in 2000, 54 boulevard Haussmann in Paris 9e, leases in respect of
97% of the estimated total income have been signed with three major
retailers, Galeries Lafayette, Hennes & Mauritz and Bouchara.
- In February 1999, Hammerson established a joint venture in Birmingham with
Henderson Investors and Land Securities plc, known as The Birmingham
Alliance, to redevelop property interests formerly owned by the individual
partners. Hammerson now has a one third interest in the 12 hectare Bull
Ring site where enabling works were started in July last year as a prelude
to the development of a 100,000 sq m shopping centre, the main construction
of which will start in 2001. Selfridges and Debenhams will be the principal
department stores anchoring the scheme.
- Through the Birmingham Alliance, Hammerson also now owns a one-third
interest both in the nearby Martineau Place site, where enabling works to
provide 16,700 sq m of shop units started recently, and in the adjacent
Priory Square Shopping Centre. The latter provides a good current income
and longer term redevelopment potential.
OFFICE SECTOR REVIEW
Office Markets
- Occupational demand for offices in London remained healthy during 1999 with
take up exceeding the high levels seen in 1997 and 1998. With the amount
of existing development still relatively limited, the outlook remains good.
In the West End and Docklands, the shortage of newly built space led to
strong increases in rents of around 15% and 50% respectively. In the City,
prime rents showed only a slight increase. Investment demand remained
strong with the volume of transactions at a record level and values
increasing.
- In the Paris office market, take-up exceeded two million sq m in 1999.
Demand is particularly strong for units in excess of 5,000 sq m and prime
rents have reached FF3,500 per sq m, a record for this cycle. Tight
planning restrictions in central Paris have limited new development
activity. Consequently, the prospects for rental growth are good, with
some forecasts of prime rents reaching FF4,000 per sq m during 2000.
Investment demand for offices remained strong, with the overall value of
transactions around 45% higher than in 1998.
Offices - Investment Portfolio
- At 31 December 1999, the group owned 24 completed office investment
properties mainly in central London and central Paris, valued at £970
million and providing some 250,000 sq m of accommodation. In addition,
the group is currently undertaking two office developments, both in
London. The group's office development properties have a cost of £127
million and a market value of £134 million.
- During 1999, three major office investment properties in London were
acquired. Harbour Exchange, London E14, purchased for £77 million in
January 1999, provides 44,600 sq m of high specification offices and
represents Hammerson's first investment in Docklands, an area where rents
and values have subsequently increased markedly. The Euston Square
Estate, London NW1, purchased for £84 million in March comprises four
office buildings providing in total 28,000 sq m of office accommodation.
The third property, 18/19 Hanover Square, London W1, which provides a
total of 5,800 sq m of office space in a prime location, was acquired for
£34 million and provides a good initial income and medium term
redevelopment potential.
- During 1999, Hammerson also sold two office property holdings in central
London. The group's 65.22% interest in The Holborn Links Estate, London
WC1 was sold for £81 million and 77/78 Victoria Street, London SW1 for
£14 million.
- In April 1999, the group announced the pre-letting of 40 rue de
Courcelles, Paris 8eme to ABN Amro for a nine year term at a rent of
almost FF3,500 per sq m. This prime 17,700 sq m office building
was completed in July and generated a development surplus of £35 million
on its transfer to the investment portfolio.
- During 1999, there was an underlying increase in the value of the group's
UK office portfolio of 10.8%, of which around half reflected higher rents
and half reflected favourable yield shifts. In France the increase was
6.6%, excluding 40 rue de Courcelles.
- Total returns from the group's office portfolio, excluding 40 rue de
Courcelles, are summarised below:
Office Underlying Income Total
portfolio valuation return return
movement
% % %
UK 10.8 6.7 7.5
France 6.0 7.4 13.4
Total 10.8 6.6 17.4
- At 31 December 1999, the overall vacancy rate in the office portfolio was
6.5%, compared with 3.4% at the end of 1998. The principal voids were in
respect of Centennium House, London EC3, The Rotunda in Birmingham and
West Riding House in Leeds.
- On a like-for-like basis, net rental income from the group's office
portfolio increased by 7.9% in 1999.
- The group's office portfolio provides a high quality secure income stream
offering good growth potential. At 31 December 1999, the group's office
portfolio was 1.0% over-rented overall and the weighted average unexpired
lease term was 10 years.
Net rental Reversionary/ Vacancy Unexpired
income (Over-rented) rate% Lease
£m % % terms years
UK 55.4 (1) 7.0 10
France 1.9 2 nil 8
Total 57.3 (1) 6.5 10
- Annual rents receivable from the group's five largest office tenants now
total around £25 million. These tenants are ABN Amro, British American
Tobacco, Lazards, National Power and Railtrack.
- In the UK, the portfolio was over-rented at the year end by 1%.
However, this reflects a net position of nine properties over-rented by
40% and ten properties reversionary by 25%. In respect of the ten
reversionary properties, rent reviews or expiries provide opportunities
for increased income. In respect of over-rented leases, only one
significant lease expires in the next five years. This is at Gan House,
London EC4, where the current passing rent is approximately £1.6 million
and where the lease expires in Autumn 2000.
- In France, the group's two office investment properties in Paris will
generate passing rents of £6.4 million following rent free periods, close
to the estimated current market rents.
Office Developments
- The group's current office developments are summarised below:
Project Description Total Completion
development date
cost
16 Old Bailey Office building of £ 49 m May 2000
London EC4 8,500 m2
280 Bishopsgate Office building of £130 m Oct 2001
London EC2 23,200 m2
- There is an encouraging level of interest from prospective tenants in
respect of 16 Old Bailey, London EC4. Construction of 280 Bishopsgate,
London EC2, a landmark 13-storey building started in January of this
year, following Hammerson's acquisition of the site for £28 million
in December 1999.
- Hammerson has also secured several other office development opportunities
which can be advanced when appropriate. At 1 London Wall, London EC2, the
group has entered into a 50:50 joint venture with Kajima providing the
potential to develop a 19,000 sq m office tower in this prime location.
- In September 1999, Hammerson exchanged contracts to acquire 51/53 Quai
d'Orsay and 8/12 rue Surcouf, Paris 7eme. Settlement of the
consideration is due in late 2000. The group is currently progressing
plans to carry out a major refurbishment of the 1930's building at Quai
d'Orsay to provide 9,900 sq m of modern offices and a total redevelopment
of the second property to provide an office building of 11,900 sq m.
Work is expected to start in January next year with completion scheduled
for July 2002 at an approximate total cost of £110 million.
- In September 1999, Hammerson also announced that it had signed an
agreement with AXA, the leading French insurance and financial services
group, to redevelop adjoining properties at 9 place Vendome and 368/374
rue Saint Honore, Paris 1er. Over the next two years the partners will
advance plans for a major redevelopment, on a 50:50 basis, managed by
Hammerson France, to create 10,000 sq m of prestigious retail space and
17,000 sq m of prime offices.
Audited Consolidated Profit and Loss Account
for the year ended 31 December 1999
Notes 1999 1998
£m £m
Net rental income: Continuing operations 123.3 107.4
Discontinued operations - 20.5
1 123.3 127.9
Administration expenses (14.3) (16.3)
Operating profit: Continuing operations 109.0 93.9
Discontinued operations - 17.7
109.0 111.6
Exceptional items:
Profit on the sale of investment properties 18.0 7.2
Profit on the sale of Canadian operations 3.3 12.9
Profit on ordinary activities before interest 130.3 131.7
Cost of finance (net) 2 (35.8) (42.8)
Profit on ordinary activities 94.5 88.9
before taxation
Taxation 3 0.1 (20.2)
Profit on ordinary activities after 94.6 68.7
taxation
Equity minority interests (6.1) (2.3)
Profit for the financial year 88.5 66.4
Dividends 4 (38.4) (36.9)
Retained profit for the financial year 50.1 29.5
Earnings per share 5 30.7p 23.1p
Diluted earnings per share 5 30.2p 23.1p
Adjusted earnings per share 5 21.6p 21.1p
Audited Consolidated Balance Sheet
as at 31 December 1999
Notes 1999 1998
£m £m
Fixed assets
Land and buildings 6 2,656.7 2,163.2
Fixtures, fittings and equipment 0.6 0.7
Tangible assets 2,657.3 2,163.9
Investments 7 13.0 -
2,670.3 2,163.9
Current assets
Debtors 94.7 371.6
Cash and short term deposits 8 146.2 165.3
240.9 536.9
Creditors falling due within one year
Borrowings 9 (28.9) (31.3)
Other (175.6) (163.1)
Net current assets 36.4 342.5
Total assets less current liabilities 2,706.7 2,506.4
Creditors falling due after more than one year
Borrowings, including convertible bonds 9 (975.8) (1,032.6)
Other (11.1) (14.3)
Equity minority interests (25.9) (60.8)
1,693.9 1,398.7
Capital and reserves
Called up share capital 72.2 72.1
Share premium account 528.1 525.9
Revaluation reserve 717.0 489.0
Other reserves 1.5 1.5
Profit and loss account 375.1 310.2
Equity shareholders' funds 1,693.9 1,398.7
Net asset value per share 5 586p 485p
Diluted net asset value per share 5 573p 481p
Audited Statement of Total Recognised Gains and Losses
for the year ended 31 December 1999
1999 1998
£m £m
Profit for the financial year 88.5 66.4
Unrealised surplus on revaluation of properties 240.3 131.1
Taxation credit/(charge) on realisation of 13.3 (22.8)
previous years' revaluation gains
Exchange translation movements (10.8) (4.2)
Total recognised gains and losses for the year 331.3 170.5
Audited Note of Historical Cost Profits and Losses
for the year ended 31 December 1999
1999 1998
£m £m
Profit on ordinary activities before taxation 94.5 88.9
Realisation of previous years' revaluation gains 8.8 30.9
gains
Historical cost profit on ordinary 103.3 119.8
activities before taxation
Historical cost profit for the financial 72.2 37.6
year after taxation, equity minority
interests and dividends
Audited Reconciliation of Movements in Shareholders' Funds
for the year ended 31 December 1999
1999 1998
£m £m
Retained profit for the financial year 50.1 29.5
Other recognised gains and losses 242.8 104.1
Issue of shares 2.3 12.3
Net increase in shareholders' funds 295.2 145.9
Shareholders' funds at 1 January 1,398.7 1,252.8
Shareholders' funds at 31 December 1,693.9 1,398.7
Audited Consolidated Cash Flow Statement
for the year ended 31 December 1999
Notes 1999 1998
£m £m
Net cash flow from operating activities 10 120.4 115.9
Returns on investment and servicing 10 (55.3) (52.8)
of finance
Corporation tax paid (52.9) (26.5)
Capital expenditure 10 (366.7) (262.5)
Acquisitions and disposals 10 400.1 (78.9)
Equity dividends paid (49.0) (11.5)
Cash outflow (3.4) (316.3)
Decrease/(Increase) in short term deposits 14.6 (74.6)
Net cash (outflow)/inflow from financing (15.5) 399.9
(Decrease)/Increase in cash in the year (4.3) 9.0
Audited Reconciliation of Net Cash Flow to Movement in Net Debt
for the year ended 31 December 1999
1999 1998
£m £m
(Decrease)/Increase in cash in the year (4.3) 9.0
Decrease/(Increase) in debt 17.8 (399.2)
(Decrease)/Increase in short term deposits (14.6) 74.6
Change in net debt resulting from cash flows (1.1) (315.6)
Disposal of secured bank debt on
disposal of subsidiary - 26.5
Adoption of secured bank debt on
acquisition of property - (28.5)
Exchange adjustment 41.2 (0.2)
Movement in net debt in the year 40.1 (317.8)
Net debt at 1 January (898.6) (580.8)
Net debt at 31 December (858.5) (898.6)
1. SEGMENTAL ANALYSIS
1999 1998
Gross Other Net Net
rental Rents property rental rental
income payable outgoings income income
£m £m £m £m £m
Rental income
United Kingdom 112.0 8.6 8.7 94.7 80.0
France 22.7 - 2.0 20.7 20.7
Germany 10.4 0.3 2.2 7.9 6.7
Continuing operations 145.1 8.9 12.9 123.3 107.4
Discontinued
operations- Canada - - - - 20.5
145.1 8.9 12.9 123.3 127.9
1999 1998
Assets Net Net Assets Net Net
employed debt assets employed debt assets
£m £m £m £m £m £m
Assets employed
United Kingdom 1,927.3 (379.3) 1,548.0 1,354.1 (155.8) 1,198.3
Continental Europe 625.1 (479.2) 145.9 618.4 (514.3) 104.1
Continuing operations 2,552.4 (858.5) 1,693.9 1,972.5 (670.1) 1,302.4
Discontinued operations - - - 324.8 (228.5) 96.3
- Canada
2,552.4 (858.5) 1,693.9 2,297.3 (898.6) 1,398.7
2. COST OF FINANCE (NET)
1999 1998
£m £m
Interest payable on:
Bank loan and overdrafts 7.8 10.5
Other loans 55.2 55.5
Interest payable and similar charges 63.0 66.0
Less:
Interest payable capitalised 19.0 11.8
Interest receivable 8.2 11.4
35.8 42.8
3.TAXATION
1999 1998
£m £m
United Kingdom corporation tax at 30.25% 10.5 14.8
(1998: 31.0%)
Advance corporation tax ('ACT') written back (4.3) (10.7)
Overseas tax 2.8 1.8
9.0 5.9
Tax (credit)/charge on disposals (9.1) 14.3
Tax (credit)/charge on profit on ordinary (0.1) 20.2
activities
Tax (credit)/charge on realisation of (13.3) 22.8
previous years' revaluation gains
In 1998 £37.1m of tax was provided on the disposal of the Canadian
business and allocated pro-rata between the profit in the year and the
realisation of previous years' revaluation gains. In 1999, following a
favourable settlement with Revenue Canada, £21.6m of this tax provision
has been written back and allocated in the same way. A £0.8m tax credit
arose on redeeming a mortgage on the sale of Holborn Links Limited.
4. DIVIDENDS
1999 1998
£m £m
Interim 4.19p (1998: 4.13p) per share 12.1 11.9
Final proposed 9.11p (1998: 8.68p) per share 26.3 25.0
38.4 36.9
5. EARNINGS PER SHARE AND NET ASSET VALUE PER SHARE
Earnings per share have been calculated on the profit for the financial
year of £88.5m (1998: £66.4m) and the weighted average number of shares
in issue during the year ended 31 December 1999 of 288.7m (1998: 287.2m).
Net asset value per share is calculated from the value of net assets at
31 December 1999 of £1,693.9m (1998: £1,398.7m) and the number of shares
in issue at that date of 288.9m (1998: 288.2m). Diluted earnings per
share and net asset value per share reflect the exercise of conversion
rights relating to the convertible bonds and of options relating to
shares.
EARNINGS PER SHARE AND NET ASSET VALUE PER SHARE (CONTD)
The adjusted profit on which the adjusted earnings per share have been
calculated as follows:
1999 1998
£m £m
Profit for the financial year 88.5 66.4
Adjustments: Exceptional items (21.3) (20.1)
Tax on property disposals (9.1) 14.3
Minority interests in exceptional 4.1 -
items
Adjusted profit for the financial year 62.2 60.6
Exceptional items and their related tax and minority interests increased
earnings per share by 9.1 pence in 1999 and by 2.0 pence in 1998.
6. LAND AND BUILDINGS
Book value Cost
1999 1998 1999 1998
£m £m £m £m
Investment Properties
Fully developed properties 2,288.6 1,958.7 1,568.9 1,441.7
Properties held for or in the
course of development 368.1 204.5 368.1 204.5
2,656.7 2,163.2 1,937.0 1,646.2
As at 31 December 1999 the market value of properties held for
development was £399.9m (1998: £246.8m). The total amount of interest
included in development properties at 31 December 1999 was £13.2m (1998:
£7.4m).
Long Short
Freeholds Leaseholds Leaseholds Total
£m £m £m £m
Movements in the year
Balance 1 January 1999 1,112.8 1,043.1 7.3 2,163.2
Exchange adjustment (72.9) (5.0) (0.2) (78.1)
Additions at cost 239.2 280.0 0.1 519.3
Disposals (168.2) (37.4) - (205.6)
Development outgoings 5.8 11.8 - 17.6
capitalised
Revaluation surplus 132.1 107.4 0.8 240.3
Balance 31 December 1999 1,248.8 1,399.9 8.0 2,656.7
7. INVESTMENTS
Investments represent a 57.2% interest in Value Retail Investors Limited
Partnership which has an interest in a designer outlet centre in
Bicester, United Kingdom. The interest was acquired during 1999 at a
cost of £11.3m. The investment is included at its market value at 31
December 1999 of £13.0m.
8. CASH AND SHORT TERM DEPOSITS
1999 1998
£m £m
Cash at bank 12.1 16.4
Short term deposits 134.1 148.9
146.2 165.3
Analysis by currency
Sterling 69.9 163.6
Euro currencies 76.3 1.7
146.2 165.3
Short term deposits in 1999 include £55.0 million, the use of which is
restricted to settling the outstanding consideration for 51/53 Quai
d'Orsay and 8/12 rue Surcouf, Paris. Settlement is expected to take
place towards the end of 2000.
9. BORROWINGS
1999 1998
£m £m
Unsecured
£200 million 7.25%Sterling bonds due 2028 197.1 197.0
£200 million 10.75% Sterling bonds due 2013 193.9 193.6
E300 million 5% Euro bonds due 2007 184.3 -
£110 million 6.5% Sterling convertible bonds due 2006 107.9 107.7
£86.4 million 7.875% Sterling bonds due 2003 84.6 84.1
Bank loans and overdrafts 238.1 452.8
Other loans - 1.1
1,005.9 1,036.3
Exchange difference on currency swaps (27.5) (29.9)
978.4 1,006.4
Secured
Sterling mortgages 6.25%-9.25% due between
2022 and 2070 - 14.2
Deutschemark mortgages 5.24%-6.613% due between
2000 and 2006 24.0 28.5
Deutschemark bank loans 1.92%-7.22% due
between 2000 and 2051 2.3 14.8
26.3 57.5
1,004.7 1,063.9
BORROWINGS
Maturity
Bank loans Other 1999 1998
and overdrafts loans Total Total
£m £m £m £m
After 5 years - 679.7 679.7 771.3
From 2-5 years 209.1 86.5 295.6 260.3
From 1-2 years 0.3 0.2 0.5 1.0
Due after more than 1 year 209.4 766.4 975.8 1,032.6
Due within 1 year 28.7 0.2 28.9 31.3
238.1 766.6 1,004.7 1,063.9
Interest rate and currency profile 31 December 1999
Floating rate
Fixed rate borrowings borrowings Total
% Years £m £m £m
Sterling 8.34 21 415.3 33.9 449.2
Euro currencies 6.26 2 336.7 218.8 555.5
6.68 12 752.0 252.7 1,004.7
31 December 1998
Floating rate
Fixed rate borrowings borrowings Total
% Years £m £m £m
Sterling 7.06 17 202.0 117.4 319.4
Canadian dollars 9.89 3 70.3 158.2 228.5
Euro currencies 8.26 4 443.8 72.2 516.0
8.25 11 716.1 347.8 1,063.9
10.ANALYSIS OF CASH FLOWS
1999 1998
£m £m
Reconciliation of operating profit to net
cash inflow from operating activities
Operating profit 109.0 111.6
Depreciation 0.4 0.7
Letting costs written off - 0.2
Decrease/(Increase) in debtors 7.9 (5.3)
Increase in creditors 3.1 8.7
120.4 115.9
Returns on investment and servicing of
finance
Interest received 8.6 11.9
Interest paid (54.2) (63.8)
Dividends paid to minorities (9.7) (0.9)
(55.3) (52.8)
Capital expenditure
Purchase and development of property (477.5) (330.0)
Sale of property 110.8 67.5
(366.7) (262.5)
Acquisitions and disposals
Disposal of subsidiary companies 400.1 (14.9)
Purchase of subsidiary companies - (64.0)
400.1 (78.9)
11. FINANCIAL STATEMENTS
The consolidated profit and loss account and balance sheet set out above
are not statutory accounts as defined in Section 240 of the Companies Act
1985 but are derived from those accounts. Statutory accounts for the
year ended 31 December 1999 have been reported on by the Company's
auditors and will be delivered to members and the Registrar of Companies
in due course. Statutory accounts for the year ended 31 December 1998
have been reported on by the Company's auditors and delivered to the
Registrar of Companies. The audit reports on the 31 December 1999 and 31
December 1998 financial statements were unqualified and did not contain a
Statement under Section 237(2) or Section 237(3) of the Companies Act
1985.
12. NOTICE OF MEETING
The Annual General Meeting will be held at 10.30 a.m. on Thursday, 11 May
2000 at 100 Park Lane, London W1Y 4AR.
PROPERTY PORTFOLIO INFORMATION
For the year ended 31 December 1999
Development Fully Underlying Net Vacancy
properties developed valuation rental rate
at cost investment change Income
properties
£m £m % £m %
United Kingdom
Retail London &
South East 134.3 597.9 7.3 25.9 1.0
Midlands & 38.8 251.4 7.7 13.4 0.5
North of England
173.1 849.3 7.4 39.3 0.9
Office City 63.0 397.0 4.9 28.3 6.2
West End - 300.4 12.1 19.9 0.3
Docklands - 163.0 25.4 7.2 12.4
and Other
63.0 860.4 10.8 55.4 7.0
Total United 236.1 1709.7 9.2 94.7 3.7
Kingdom
Continental
Europe Retail France 59.5 326.6 11.7 18.8 2.8
Germany 8.3 142.8 2.4 7.9 6.5
67.8 469.4 8.7 26.7 4.6
Office France 64.2 109.5 6.0 1.9 -
Total Continental 132.0 578.9 8.7 28.6 4.2
Europe
Group Retail 240.9 1318.7 7.9 66.0 2.5
Office 127.2 969.9 10.8 57.3 6.5
Total Group 368.1 2288.6 9.1 123.3 3.8
Number of fully developed investment properties by value
Above Between Between Below Total
£100m £50m and £25m and £25m
£100m £50m
Retail 6 5 1 4 16
Office 3 4 4 13 24
Total 9 9 5 17 40
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