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« on: February 22, 2017, 12:42:09 pm »
PRESS RELEASE
CAPITAL & COUNTIES PROPERTIES PLC ("CAPCO")
AUDITED PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2016
Ian Durant, Chairman of Capco, commented:
"Capco has delivered good progress in 2016 with considerable activity and milestones achieved at both Covent
Garden and Earls Court. Despite macro-economic uncertainty, London is one of the great cities of the world;
desirable as a retail destination and residential location.
Looking through short-term market movements, Capco's long-term strategy remains unchanged. We are
confident in the strength of our two prime London assets and are well positioned to deliver long-term value
creation for our shareholders."
Ian Hawksworth, Chief Executive of Capco, commented:
"Capco has made significant progress at its two central London estates during 2016. Covent Garden has
introduced high quality retailers and restaurants, resulting in a record year of leasing transactions, producing an
uplift in value of 6 per cent to GBP2.3 billion and an increase in ERV of 8 per cent. At Earls Court, the first phase of
demolition is now complete, de-risking the site and preparing the land for future development. Weakened
sentiment in the residential market, following changes to stamp duty and political uncertainty, particularly in the
first half of 2016, led to a valuation decline at Earls Court Properties of 20 per cent to GBP1.1 billion. As a result,
EPRA NAV declined by 6 per cent to 340 pence per share.
The strong demand for central London retail has continued in 2017 and Covent Garden has had a positive start to
the year. We have increased the ERV target to GBP125 million by December 2020, reflecting the positive prospects
of the estate. The first residents have moved into Lillie Square and additional units will be released over the
coming months, now that the first release of Phase 2 is predominantly sold. Land enablement will continue at
Earls Court and we intend to progress plans to increase the number of much needed homes as we maximise the
potential of this strategic land holding.
Capco remains focused on its strategy to deliver long-term value creation from its two unique central London
estates. Backed by a strong balance sheet with low LTV and high liquidity, the Group is well positioned to
withstand short-term market uncertainty and take advantage of opportunities as they arise."
Key financials
- Equity attributable to owners of the Parent GBP2.8 billion (H1 2016: GBP2.8 billion) (2015: GBP2.9 billion)
- EPRA NAV 340 pence per share, a decrease of 5.9 per cent (H1 2016: -4.7 per cent, H2 2016: -1.2 per
cent) (2015: 361 pence)
- Total property value GBP3.7 billion, a decrease of 4.4 per cent (like-for-like) (H1 2016: -3.8 per cent, H2
2016: -0.6 per cent) (2015: GBP3.7 billion)
- Proposed final 2016 dividend of 1.0 pence per share providing a full-year dividend of 1.5 pence per share
Strong performance at Covent Garden following record year of leasing activity; new ERV target
- Total property value of GBP2.3 billion an increase of 6 per cent (like-for-like) (2015: GBP2.0 billion)
- 95 new leases and renewals transacted representing GBP13.3 million of income at 9 per cent above 31
December 2015 ERV
- ERV increased by 8 per cent (like-for-like) to GBP96 million (2015: GBP86 million)
- New ERV target of GBP125 million by December 2020
- Floral Court (formerly known as Kings Court) on track for completion towards the end of 2017
- GBP85 million invested in acquisitions expanding ownership of the estate
Significant progress on site at Earls Court
- Earls Court interests valued at GBP1.1 billion, a decrease of 20 per cent (like-for-like) (2015: GBP1.4 billion)
- Completion of first phase of demolition of EC1 & EC2; final phase of demolition underway, preparing the
site for future development
- Representations submitted to GLA's London Plan to enhance the Earls Court Masterplan
- Construction of Phase 1 of Lillie Square progressing well and the first residents have moved in; sales of
Phase 2 continue at a modest premium to comparable units in Phase 1
Operational excellence at Venues
- EBITDA of GBP19 million, up 29 per cent (2015: GBP15 million)
- Property valuation at GBP293 million, a decrease of 1 per cent (like-for-like) (2015: GBP295 million)
Strong financial position
- Group loan to value ratio 23 per cent (2015: 16 per cent)
- Cash and available facilities of GBP556 million (2015: GBP412 million)
- Weighted average maturity extended to 5.9 years and average cost of debt reduced to 2.7 per cent
- Capital commitments of GBP157 million (2015: GBP207 million)
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