Emerson Group alive to opportunities
EMERSON Group, the Cheshire-based property developer with assets in the US and Portugal as well as the UK, boosted profits by nearly 7% to £18.5m despite seeing turnover fall.
The group, owned by the Jones family, said reduced activities in its commercial contracting division was behind a near £10m fall in turnover to £147.5m in the year to April 30.
The group, which owns the Middlebrook Retail Park in Bolton but recently sold its Lowry Outlet Mall in Salford Quays to Peel Group, said a revaluation of its Orbit commercial property portfolio had led to a 2% fall in shareholders’ funds from £652m to £638m.
Chairman Peter Emerson Jones said: “The retail sector continues to show a strong yield. The office sector has been revalued to reflect the downtunr in northern property valuations due to shorter lease lengths and higher incentives to tenants, which has a negative effect.”
Rental income in the year did rise, from £76.8m to £77.7m, with a rental surplus over interest costs was £43.6m.
On the residential side, which trades as Emerson Homes, Mr Jones reported a “reasonable” performance in a difficult market, with profits falling £1.5m to £7.1m on turnober of £60.6m (£62.2m in 2011).
Looking ahead Mr Jones said uncertainty remains the key watchword, and the board are focused on the key issues affecting the business, while also remaining flexible and responsible.
“Ultimately, the returned of sustained growth will be driven by a renewal of confidence in the wider economy. We have seen this to some extent in our US division and it is hoped that the upturn will quickly transfer to the UK and Europe.
“However, the current market will present opportunities and our strong balance sheet, available cash and reserves will enable us to take swift advantage of thses, providing any future purchases meet our investment criteria.”
The group’s international division includes several Portugese golf resorts, plus residential, commercial and leisure developments in Florida.
Group operating profits were down on the prior year at £55.4m (57.2m in 2011), but lower exceptional exchange losses – related to some borrowings in Yen- meant bottom line profits were ahead.
