UK and JSE listed real estate investment trust Liberty International on Friday reported adjusted earnings per share of 11.6 pence for the six months ended June 2009 from 13.9 pence a year ago.

A 5 pence per share interim dividend was declared, with the intended full year dividend of 16.5 pence - unchanged from 2008.

The group reported net rental income of £190 million from £104 million a year ago - a decline of 2%, with UK regional shopping centres like-for-like 5% below 2008's first half due to tenant failures.

It reported a loss before tax £452 million after a loss of £458 million a year ago.

Chairman Patrick Burgess said: "Liberty International's growth over the years has come as much from active management and redevelopment as other factors, and we already have within our existing asset base a number of opportunities of this kind, awaiting appropriate market conditions.

"Beside the prime nature of our assets, we are recognised as having a highly effective management, the worth of which the last few months have more than proven.

"We are alive to the changing market and investor environment and in our properties and management team have what we need to answer successfully to new opportunities to the benefit of shareholders.

"We have positioned the group for market recovery in due course, and believe retail, and thereby prime retail property, is likely to be at the forefront of such recovery."

The group said investment property valuation decline moderated in the second quarter to 4.3% after approximately 8.5% in the first quarter.

A total of £592 million in new equity raised has increased cash and available facilities to £928 million.

Capital Shopping Centre's (CSC) UK regional shopping centre occupancy was maintained at 98.3% from 98.7% at the end December 2008.

St David's 2 in Cardiff will open in Autumn 2009, and is now 64% committed by area, 53% by income, with a further 8% in advanced negotiation, the group said.

At Covent Garden in London, occupancy is up to 99% from 97% at end December 2008, with Bedford Chambers handed over for refurbishment for a major new flagship store opening in 2010.

Looking ahead, the group said the signs of stability, if not yet recovery, in property and economic conditions are welcome.

However, the scale of the public sector deficit and the measures required to bring government finances into reasonable balance are likely to represent a constraining factor on UK growth prospects for some years to come.

"Nevertheless, Liberty International has a high quality and defensive UK regional shopping centre and retail property business, which includes 9 of the top 30 UK centres and prime Central London sites such as Covent Garden.

"Relatively our properties have performed well in capital value terms since the downturn which began two years ago in the second half of 2007," it said.

Tenant failures amounting to over £30 million of CSC's passing rent in the last three quarters will adversely impact underlying earnings, notwithstanding the satisfactory re-letting progress this year.

Furthermore, earnings per share will be negatively impacted in the short term as the proceeds of the Capital Raising are for the present largely held in cash earning a low return pending their most effective deployment, which will depend on property and debt market conditions, and secondly as the group is now temporarily over-hedged against interest rate risk.

Growth avenues for the group remain considerable with numerous active management and development opportunities within existing CSC centres and its Central London assets to be undertaken when market conditions are appropriate, it said.

"In the meantime, our rental income prospects have benefited as the difficult property and economic conditions have sharply curbed further supply of retail space in the UK.

"The group's larger scale and attractive quality retail destinations continue to outperform inferior locations.

"We have positioned the group for market recovery in due course, and believe retail, and thereby prime retail property, is likely to be at the forefront of such recovery," it concluded.