UK property investment company Liberty International on Tuesday reported a 10% rise in adjusted earnings per share to 26.7 pence for nine months ended September from 24.3 pence a year ago.
The group reported net rental income of P261 million from P246 million for the same period a year ago, while attributable profit amounted to P407 million.
"Liberty International is pleased to report further strong results for the third quarter of 2007," said Sir Robert Finch, chairman of Liberty International.
"Adjusted earnings per share of 26.7p for the nine months ended 30 September 2007 show a 10 per cent increase on the equivalent period in 2006. Adjusted net assets per share of 1369p (equivalent to 1478p adding back notional property acquisition costs deducted from valuations) match the 1385p reported at 30 June 2007 as reduced by the interim dividend of 16.5p paid in the quarter," he added.
"This outcome vindicates our focus over a long period on highest quality real estate, in particular regional shopping centres. Evidence has remained strong this year that super-prime or prime regional shopping centres, well managed and properly marketed, attract considerable investor interest," he said.
Sir Robert added that after several years of buoyant market conditions, the third quarter of 2007 had seen valuers taking a more cautious view of UK property.
"Our overall gains for the year on the revaluation and sale of investment properties reduced from P231 million at 30 June 2007 to P192 million at 30 September 2007.
"The valuation yields for the majority of CSC's UK regional shopping centres were unchanged in the quarter ended 30 September 2007, but increases for three of the smaller centres moved the overall average slightly upwards from 4.77 percent at 30 June 2007 to 4.82 per cent at 30 September 2007, effectively the same as applied by the valuers at December 31, 2006.
These results confirm the defensive merits of our UK regional shopping centres, with resilient income streams and low volatility in capital values.
"Evidence has remained strong this year that super-prime or prime regional shopping centres, well managed and properly marketed, attract considerable investor interest; such centres are noticeably outperforming secondary centres with the gap in valuation yields widening as investors once again begin to factor in the much greater risks of lower quality assets."
Furthermore, the yields applied by valuers to prime regional shopping centres continue to look undemanding compared with other prime UK property asset classes.
"We are confident that Liberty International's concentration on super-prime or prime large-scale and predominantly retail real estate will be advantageous in any overall flight to quality by UK property investors," he said.
Sir Robert said that Liberty International's financial position remained exceptionally strong with a debt to assets ratio of 39 percent at September 30, 2007 and a long-term debt structure, predominantly on an asset-specific and fixed rate basis and with no significant repayments before 2011.
"We have around P500 million of unutilised committed borrowing facilities to finance all our development commitments," he added.
Looking ahead, he said: "Liberty International has been built over a period of 27 years and now owns an irreplaceable range of prime regional shopping centres and other real estate holdings with a very strong retail focus.The team behind that ownership is one of the strongest in the country with a depth of expertise, knowledge and track record which is unrivalled.
This allows us to have every confidence in the prospects for Liberty International and in our ability to extend the group's successful long-term track record."We look forward to the investment opportunities and challenges which a changing market will bring."
Listed in London and Johannesburg, Liberty International owns Capital Shopping Centres (CSC), the premier UK regional shopping centre business, and Capital & Counties, a retail and commercial property investment and development company.
