Edition:
India

Hammerson Announces Disposal Targets, Buyback, Adjusts Dividend Growth Rate


Tuesday, 24 Jul 2018 

July 24 (Reuters) - Hammerson PLC ::STRATEGY UPDATE AND UNAUDITED 2018 HALF-YEAR RESULTS.DISPOSAL TARGET OF £1.1 BILLION BY END OF 2019, WITH £300 MILLION ALREADY ACHIEVED THIS YEAR.HY NET RENTAL INCOME £178.5M VERSUS 184 MILLION STG REPORTED LAST YEAR.INCREASED OVERALL 2018 DISPOSAL TARGET OF £600 MILLION.HY ADJUSTED. PROFIT £120.0M VERSUS 119.4 MILLION STG REPORTED LAST YEAR.TO EXIT RETAIL PARKS SECTOR OVER MEDIUM TERM.COMMENCING A SHARE BUYBACK OF UP TO £300 MILLION.DUE TO INCREASED RISKS IN CURRENT MARKET ENVIRONMENT, START ON SITE OF DEVELOPMENT AT BRENT CROSS IS TO BE DEFERRED.TO DELEVERAGE WITH INTENTION TO REDUCE LTV TO MID-30S% LEVEL OVER MEDIUM TERM.EXPECTS TO DELIVER COST SAVINGS OF AT LEAST £7 MILLION P.A. THROUGH OPERATIONAL EFFICIENCIES AND LOWER CORPORATE COSTS.WILL NOW FOCUS SOLELY ON WINNING DESTINATIONS OF HIGHEST QUALITY.SEES SHRINKING DEPARTMENT STORE SPACE BY A QUARTER AND HIGH STREET FASHION BY A FIFTH.WILL NOW FOCUS SOLELY ON WINNING DESTINATIONS OF HIGHEST QUALITY: FLAGSHIP RETAIL DESTINATIONS AND PREMIUM OUTLETS.SEES DEPARTMENT STORE SPACE, HIGH STREET FASHION REPLACED BY DIFFERENTIATED BRANDS, ASPIRATIONAL FASHION, LEISURE, EVENTS & LIFESTYLE SPACES.HY GROUP VALUATIONS STABLE WITH CONTINUED GROWTH IN PREMIUM OUTLETS AND IRELAND OFFSETTING A SMALL YIELD-DRIVEN VALUATION DECLINE IN UK.PROPOSED BUYBACK WILL BE ACCRETIVE TO EPS AND NAV PER SHARE.IN NEAR TERM, WHILE CO DISPOSES OF ASSETS TO OPTIMISE PORTFOLIO MIX, INCOME WILL BE NEGATIVELY IMPACTED.