British Land Co on Thursday reported a surge in profit during its most recent financial year, as it swung to positive gains on investment property disposals and joint ventures.
The London-based commercial property developer and investor said pretax profit for the year that ended March 31 was £342 million, multiplied from £15 million the year before.
Revenue declined 21% to £454 million from £575 million, but cost of sales was reduced by 16% to £123 million from £146 million.
More importantly, British Land swung to a positive £148 million gain on disposal of investment properties, joint ventures and revaluation of investments from a £131 million loss a year prior.
British Land declared a total dividend of 22.80 pence per share, unchanged on-year.
‘I am pleased with our strong operational and financial performance this year. We continue to lease space at rents significantly ahead of valuers’ expectations which, combined with good cost control and successful asset management, means we have maintained our underlying earnings per share, despite significant development activity which will be a key driver of future earnings growth,’ said Chief Executive Officer Simon Carter.
‘Values increased 1.6%, with a particularly strong performance from retail parks, up 7.1% and campuses returned to growth in the second half of the year, increasing by 0.8%.’
Diluted earnings per share swung to 35.0 pence from a 0.1p loss the year before.
EPRA net tangible assets per share were up 0.9% at 567p from 562p.
CEO Carter continued: ‘The continued occupational strength of our key markets and the resulting above inflation rental growth gives us confidence for the future and in our strategy, despite ongoing macro volatility.
‘Return to the office is in full swing, with mid-week occupancy back to pre-pandemic levels, and value and multi-channel retailers are competing aggressively for space on our retail parks. This, combined with the acute lack of supply in both these markets is resulting in strong rental tension, which will translate into future earnings growth and underpins our guidance of 3-5% per annum rental growth across the portfolio.’
British Land expects financial 2026 underlying earnings per share to be broadly flat, which equates to underlying profit growth of 2%.
The company expects 3% to 6% per annum earnings growth ‘in subsequent years’, which includes around 4 pence in underlying earnings per share from developments planned for financial 2027.
Shares in British Land were down 3.6% at 396.80 pence each in London on Thursday morning.
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