Net income increased by 13% to â⬠41.3m, earnings per share increased by 2% to â⬠1.43, shareholdersââ¬â¢ equity increased by 4% to â⬠659m, dividend per share increased by 2% to â⬠1.43, total assets increased by 3% to â⬠1.254 m, net asset value per share increased by 2% to â⬠2.53.
The board of Eurocommercial Properties NV announced today that as a result of higher earnings in the financial year to 30 June 2003 it proposes increasing the Companyââ¬â¢s annual dividend by 2% to â⬠1.43 per depositary receipt (10 ordinary shares) from â⬠1.40 in 2002. Shareholders will again be offered the option of taking new shares from the Companyââ¬â¢s share premium reserve if they wish, instead of the cash dividend. The price for these shares will be announced on 31 October 2003.
Overall net property income for the year rose slightly to â⬠66.3 million from â⬠65.9 million reflecting property sales in 2001/2002 and purchases during this year. The overall net income after reduced interest and other expenses was â⬠41.3 million for 2002/2003 and represents an increase of approximately 13% over â⬠36.6 million last year.
Net asset value
Net asset value before income appropriation improved by 2% to â⬠22.53 per depositary receipt as a result of increased independent property valuations and after allowing for an appropriate increase in the provision for potential future capital gains taxes. The net asset value in June 2002 was â⬠22.09 per depositary receipt.
Property performance
The Companyââ¬â¢s property portfolio performed well over the year with a total return of 8.9%. The overall property occupancy rate is 99.9%. Average retail sales in the Companyââ¬â¢s shopping centres were up 2.9% on 2002 but individual centres have shown increases of up to 8%.
The Companyââ¬â¢s independently assessed property values increased 2.3% overall compared with 2002.
Individual country increases were: France + 2.1%, Italy + 3.7%, The Netherlands - 1.7%, Sweden + 1.5%. Sector increases were: Retail + 3.1%, Offices - 2.7%, Warehouse + 1.7%.
Market outlook
Most large western European property markets are in equilibrium for the moment with weight of investment demand and limited property supply pushing yields slightly down and prices up despite some caution over future rental growth in view of the stagnation in major European economies.
Investment programme
The Company plans to invest at least â⬠100 million in retail property in the 2003/2004 financial year, in addition to the â⬠50 million committed last year in Grenoble, Mantova and VästerÃÂ¥s. In fact, transactions of just over â⬠100 million have already been agreed in principle although legally binding contracts are not yet finalised.
Eurocommercial Properties N.V. is focussing on retail properties whose income is extremely secure because of diversity of tenancies and supportable rent levels. The Company is not currently considering office buildings having sold the majority of its portfolio in 2001/2002 but may well do so to a limited degree in coming years, when oversupplies of space have better prospects of being absorbed.
Source: Eurocommercial Properties
