Hammerson retains caution as interims show improvement

Hammerson (LON:HMSO), the shopping centre and office developer, reported a modest uptick in  the value of its property portfolio as it said the outlook for the remainder of the year was "uncertain".

The net asset value of the firm, which has operations in the UK and France edged up 7.8 per cent in the six months to June 30 to 454p a share.

Pretax profits advanced to £335.6 million from an £818.5 million loss a year ago. However this figure was inflated by a revaluation gain of almost £259 million. Underlying earnings advanced 7 per cent to £70.2 million.
The company is paying a 7.15p a share interim dividend, a rise of 2.9 per cent on the year earlier.

Chairman John Nelson gave a rather downbeat assessment of prospects as he said: ‘"Although our markets have continued to recover from recession over the first half of 2010, the outlook remains uncertain.

"Against this background we are maintaining a clear focus on improving our portfolio, maximising the income from each of our assets and sound financial management.

"We have made good progress this year in each of these areas. The underlying quality of our portfolio has been demonstrated in our results, with lower vacancy and growing income in a challenging environment.

"Over the period we have executed a number of transactions which will improve the future growth prospects of our business whilst releasing capital for potential reinvestment. We have advanced our valuable development pipeline in the UK and France which will provide a basis for additional future growth."

Net rental income fell 10.5 per cent to £140m due to the disposals Hammerson made in 2009.