Hammerson confirms Bullring cinema plan as full year profits surge
RETAIL property group Hammerson has confirmed it plans to push ahead with the installation of a new cinema for the city’s Bullring Shopping Centre.
The company, now wholly-focused on the retail sector, increased its stake in the shopping centre to 50% last year when it bought out the shares owned by Future Fund in a deal worth £307m.
In its full year results statement today, Hammerson said the Bullring remained one of Europe’s leading shopping centres, attracting 40m visitors per annum.
The centre, now almost fully occupied, has seen expansion during its decade-long operation and Hammerson said further development was planned.
“Following the successful Spiceal Street restaurant extension in 2011, there remain a number of asset management and development opportunities to drive future growth at the centre, including the introduction of a cinema and additional catering,” it said.
Hammerson, which said it would continue as asset and development manager for the centre, said passing rents at the centre had grown at an annual compound rate of 5.5% since opening in 2003 and now stood at £52m per annum.
Overall, the group’s pre-tax profit for 2013, including discontinued operations, stood at £341.2m, up from £142.2m in 2012. The directors have recommended an 8% increase in final dividend of 10.8p (2012: 10p).
It said the year-on-year profit increase reflected a full year’s contribution from revaluations within Value Retail, for which it had equity accounted since August 2012, and portfolio revaluation gains of £90.3m. Property revaluation losses in 2012 amounted to £49.9m. The majority of the office portfolio was sold in 2012, and it said this explained the lower gain on sale of investment properties in 2013.
A good operational performance also contributed to the increase in profit. Losses on derivative revaluations were partly offset by lower costs relating to bond redemptions, it added.
David Atkins, chief executive of Hammerson, said: “We have reported a good set of results in a year when we saw the beginning of economic and consumer recovery in the UK. In France the economic picture is less clear cut, although personal debt levels remain low, providing the opportunity for a rebound in consumer spending when growth returns.
“We are seeing improving demand from retailers, and Hammerson is creating the right product to meet their future requirements, which provides the conditions for selected growth in rental values. We have clear visibility on a number of major development projects which will create the destination venues of the future, and drive returns to our shareholders.
“We remain on course to deliver strong growth in earnings and dividends over the medium term.”
