Hammerson, the London-listed owner of retail centres in the UK and Europe with a secondary JSE listing, yesterday declared an interim cash dividend of 72 pence (R16) per share, signifying a return to cash dividends.
Last year the group declared a 0.2p cash dividend and a 2.0p a share enhanced scrip dividend. The market reacted positively to the results, with Hammerson’s share price up 3% to R5.92 on the JSE by late yesterday afternoon.
The group’s portfolio value fell slightly to £4.7 billion to end June (Full financial year 2022: £5.1bn), mainly due to disposals. Net debt fell 24% to £1.32bn (FY22: £1.73bn). The group completed £215m of disposals in the first half, bringing the total since the start of the 2022 financial year to £410m.
The target of completing a £500m disposal programme was on track. Headline loan to value stood at 33% (FY 22: 39%). There was ample liquidity of £1.2bn (FY22:£1bn), including undrawn committed facilities and £563m of cash.
“While the macroeconomic outlook remains uncertain, we have strong leasing and operational momentum and are well placed to deliver another year of robust adjusted earnings and cash flow,” directors said.
CEO Rita-Rose Gagné said in a statement that the group had delivered a strong first half and they were pleased to announce a return to a cash dividend “as we look to the future with confidence”.
Leasing momentum in 2022 had continued into the first half of 2023 and there was a strong pipeline for the second half.
“Our core portfolio continues to attract the best occupiers which, combined with our emphasis on commercialisation and placemaking, is creating exceptional destinations for customers. At the same time, we continue to transform our operating model and platform, bringing more integrated and efficient ways of working while reducing costs,” she said.
The portfolio had been further simplified with the exit from minority stakes in France, the standalone development interests in Croydon, and other non-core land, which had generated £215m in disposal proceeds, further strengthened the balance sheet and had brought a sharper focus to investment opportunities in the core portfolio.
“Our strategy is driven by repositioning our city centre destinations in some of Europe’s fastest-growing cities from traditional retail-anchored footprints to a broader mix of uses. Today we are a more agile, market facing, asset-centric Hammerson that continues to reshape our destinations to be fit for future lifestyles,” she said.
Footfall and like-for-like sales remained strong, with the former up 4% year-on-year (UK 2%, France and Ireland 7%) and the latter up 3% in the UK, 7% in France, and 2% in Ireland.
Some 134 leasing deals were concluded in the period. Occupancy at its flagship retail cents increased by 1 percentage point year-on-year to 95%.
Administration costs fell 12% year-on-year to £26m, on track to meet a target of reducing costs by 20% by the 2024 financial year, which would bring the cumulative savings since the 2020 financial year to 30%.
BUSINESS REPORT