British Land profits boosted by retail sector

British Land Co PLC posted a 33 pct rise in pretax profits for the six months to end-September, helped by strength in the retail sector, and said the investment market remains buoyant. The group, which owns the Broadgate development in the City of London, said first half pretax profits were 87.1 mln stg, up from 65.3 mln a year earlier.

Net asset value per share increased 1.2 pct to 870 pence. Analysts´ consensus was for pretax profits of 76 mln stg, and net asset value per share of 860 pence. Earnings per share were up 47.6 pct to 15.5 pence, helped by share buybacks.

'Property sales showed an 11 pct uplift from the recent March 31 2003 valuation, bringing increased capital profits of 15.9 mln stg and trading profits of 6 mln,' the company said.

It raised its interim dividend 8 pct to 4.43 pence.

'The retail sector has continued recent trends, with growth in rents, particularly for out of town properties, and with good tenant demand,' it added.

'Office rents in Central London have softened. The investment market overall remains buoyant with demand from a wide range of UK and overseas investors and support from lenders.

'The portfolio as a whole, due to its balance between retail and offices, coupled with the long lease profile, has shown resilience to the softening of Central London office rents and values, our retail portfolio effectively underpinning office value declines over these first six months.'

The company said it will continue to seek acquisitions. The group also said it has made good progress in its search for a new CEO. 'An appointment is expected, as scheduled, not later than the 2004 Annual General Meeting.'

'The stock market has sustained serious losses over the past 3 years, from which it now appears to be making some recovery,' it added. 'This, and renewed financial sector recruiting, are encouraging for our prime City of London holdings. Our confidence in the City remains.'

'In particular Broadgate has never looked better...Property has remained an attractive asset class throughout -- particularly if it is buttressed by long leases to strong tenants, and the buildings themselves are modern, of high quality, efficient design, well located and will appeal in the future.'

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