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Half-Yearly Results For Six Months To 30 September 2010 With

Friday, 12 November 2010

"We entered the year with a clear plan. The first half has seen us deliver on that plan, building momentum across the business. Our focus on development is already driving returns through valuation gains and profits on sales. We are seeing a willingness of companies to commit to new space across our business that is slightly ahead of our expectations and we are confident in our ability to continue to exploit the opportunities we have created across our portfolio."


Results summary


30 September 2010

31 March 2010


Valuation surplus (1)



Up 3.4%

Basic NAV per share



Up 6.0%

Adjusted diluted NAV per share (2)



Up 6.7%

Adjusted Gearing (1)





Six months ended
30 September 2010

Six months ended
30 September 2009


Profit/(loss) before tax




Revenue profit



Up 5.8%

Basic EPS




Adjusted diluted EPS



Up 9.5%





(1) Including share of joint ventures

(2) Our key valuation measure

Financial highlights:

  • × Valuation surplus of 3.4% or £314.1m since March 2010
  • × Rental values up 1.1% across the total like-for-like portfolio since March 2010
  • × Outperformed IPD Quarterly Universe by 0.8%
  • × Completed disposals totalling £459.8m at an average of 5.7% above March 2010 valuations
  • × Acquisitions totalled £174.0m and expenditure on developments and refurbishments totalled £127.0m
  • × Group LTV ratio including share of joint ventures reduced to 42.1% (43.5% at 31 March 2010)
  • × Average debt maturities extended from 11.8 years in March 2010 to 11.9 years


Commenting on the results, Land Securities Chief Executive Francis Salway said:

"Our results reflect the benefit of moves we have made to position the business for the recovery in the market. We have committed significant capital to developments and it is already driving returns with a valuation uplift on our development programme of just under 10% in the six months. 


"In London, we believe that developing in a supply-constrained market is a highly attractive opportunity. We were the first to start a large development programme in London, and we have been the first to take profits from it.  We have the finance, the schemes and expertise to start additional projects in London in 2011.  As the first half demonstrated with the sale of Park House and the valuation gains on our development assets, our development activity is already driving returns.


"In Retail, we have commenced developments selectively when supported by retailers through pre-lettings.  And we see further opportunities in this area, particularly in edge-of-town locations targeted by supermarkets and other retailers.


"All our activity is underpinned by a focus on income and we managed void levels down further in our Retail Portfolio.  We have also met with considerable success on asset management lettings in London since the half-year date.


"Market conditions in our sectors are slightly more favourable than we expected at this point, with low gilt yields supporting buying interest from investors and the growth plans of large companies generating take-up of space.  We are nevertheless alive to the potential impact of tax increases and public sector job cuts, and we maintain our medium term view of a recovery in property values, albeit interspersed with ripples."


Liverpool regional perspective:

Gerald Jennings, Land Securities' portfolio director, said: "Land Securities has spent a great deal of time cementing our place within the evolving Liverpool retail offer and has embarked on an active asset management strategy to ensure we continue to increase footfall to both St Johns and Clayton Square and attract leading high street retailers."


It's been a busy year for Land Securities in Liverpool bringing key retailers such as Mothercare, Clas Ohlson, and Poundmart to Clayton Square and in St Johns just last week Aldi opened its doors for the first time in Liverpool City Centre in a 24,000sq ft ground floor store. St Johns will also welcome a new 15,000sq ft Home Bargains store when it opens in spring 2011.


James Larmuth, portfolio manager for St Johns and Clayton Square, adds: 


"We've welcomed more than 20 million Liverpool shoppers to St Johns and Clayton Square this year with the average shopper visiting 60 and 52 times a year respectively.


"We're really keen to strengthen both centres' reputations as retail destinations which offer a combination of leading high street names, fashion focused independent retailers together with value stores in comfortable and convenient locations. We need to continually improve the retail mix and shopping environment within both centres which will ultimately help us be a part of making Liverpool an even greater retail destination for all shoppers." 


- Ends -

Notes to editors

Key themes:


  • × Since January 2010, committed to start projects with total development costs of over £1bn
  • × Trinity Leeds development commenced, and now 50% let or in solicitors' hands
  • × Joint venture formed with Canary Wharf Group to develop 20 Fenchurch Street, EC3
  • × One New Change, EC4 opened on 28 October with the retail element now fully let
  • × 40 residential units at Wellington House, SW1 pre-sold, representing 68% of the units
  • × Three further developments identified to start in London in 2011:
  • 123 Victoria Street, SW1
  • 110 Cannon Street, EC4
  • 60 Ludgate Hill and 30 Old Bailey, EC4
  • × Developments already making a significant contribution to returns - with a valuation gain on our development programme of just under 10% in the six month period



  • × 'John Lewis at home' to open shops in Exeter and Chester
  • × 25,150 sq m of space agreed to be let to Primark in three transactions
  • × Major lettings to News International for 6,500 sq m at Thomas More Square, E1 (now 99% let)
  • × Extended lease agreed with Bain & Co to double their floor space at 40 Strand, WC2
  • × £22.9m of lettings agreed and £18.2m in solicitors' hands
  • × Voids in like-for-like portfolio up slightly at 5.9% (5.4% March 2010) as buildings in London are vacated prior to redevelopment. Like-for-like shopping centre and retail warehouse voids down at 4.9% (5.5% March 2010)


Recycling capital

  • × Forward sale of Park House, W1 to Barwa Real Estate for an initial consideration of £250m for the one acre site, all of the construction costs and a contingent profit share on completion
  • × Total sales of £459.8m (including Park House, W1) at an average of 5.7% above March 2010 valuation
  • × £174.0m of acquisitions, mainly the O2 Centre, NW3 and a 50% stake in Westgate Centre, Oxford
  • × £127.0m of development and refurbishment expenditure in the period
  • × Positive yield differential between purchases and sales, with an average yield on purchases of 5.8% and on sales of 2.9%
  • × More buying opportunities expected in H2 and 2011/12 and planning to continue to recycle capital through selective sales