HAMMERSON plc - FULL YEAR 2022 RESULTS

Another year of good progress

Rita-Rose Gagné, Chief Executive of Hammerson, said:

"Today, Hammerson is a better, more agile, and resilient business. Our results are evidence of another year of significant strategic, operational and financial progress, against a volatile macroeconomic and market backdrop. We have focused on what we can control - sharper operations growing like-for-like gross rental income and reducing the cost base - delivering a significant increase in adjusted earnings. Notwithstanding downward revaluations at the end of the year, we have maintained a stable balance sheet.

In the last two years, we have simplified and focused the core portfolio on city centres, delivering £628m of gross proceeds, strengthened the balance sheet, recycled capital for investment in our core assets and developments, and have made rapid progress on the transformation of our operating model and platform, resulting in a significantly reduced and reducing cost structure.

We have enlivened and reinvigorated our assets by introducing new occupiers, uses and concepts. We are actively re-purposing our destinations, with an increased emphasis on commercialisation, marketing and placemaking, in turn creating exceptional spaces for our occupiers and customers. We have brought a sharper focus to our development pipeline to create value and optionality.

We have enlivened and reinvigorated our assets by introducing new occupiers, uses and concepts. We are actively re-purposing our destinations, with an increased emphasis on commercialisation, marketing and placemaking, in turn creating exceptional spaces for our occupiers and customers. We have brought a sharper focus to our development pipeline to create value and optionality."


Summary Financial and Operating Performance:

  • Adjusted earnings up 60% to £105m (2021: £66m) benefiting from:
    • Like-for-like GRI up 8% as occupiers pivot to best-in-class destinations; Like-for-like NRI up 29% year-on-year
    • Gross administration costs down 17%, with more to come in 2023 and 2024
    • Lower finance costs following deleveraging
    • A continued recovery in adjusted earnings at Value Retail (+£12m).
  • Adjusted earnings per share up 62% to 2.1p; basic loss per share of -3.3p (2021: -8.7p)
  • Group portfolio value of £5.1bn (2021: £5.4bn), down 5% due to revaluation deficit and disposals
    • Capital return for the year of -5.8% (2021: -7.7%) and a total return of -0.7% (2021: -3.9%)
  • IFRS loss of £164m (2021: £429m loss), largely due to a £282m revaluation deficit, of which 96% was in Q4
  • EPRA NTA per share 53p (2021: 64p), 7.5p impact from enhanced scrip dividend


Solid balance sheet

  • Net debt down 4% to £1,732m at 31 December 2022 (2021: £1,799m)
    • Headline LTV 39% (2021: 39%)
    • Fully proportionally consolidated (FPC) LTV 47% (2021: 46%)
    • Net debt to EBITDA of 10.4x (2021: 13.4x)
    • Ample liquidity of £1bn, including undrawn committed facilities and £0.3bn of cash
  • Completed £195m disposals in the year and re-affirming guidance of a further £300m disposals by December 2023
  • Value Retail successfully refinanced over £1bn of debt facilities in relation to La Vallée and Bicester

Strong operational trends

  • Footfall improved 11% points from January to December 2022, ending the year at 90% of 2019 levels; sales remained ahead of 2019 levels
  • Positive footfall and sales trends have continued into the first few months of the year
  • 317 leasing deals concluded in 2022 (+2% excluding disposals), representing £45m of headline rent (£25m at our share) (+10% LFL)
    • Headline leasing 34% ahead of previous passing (2021: flat)
    • Net effective rent +2% vs ERV (2021: -11%)
    • Diverse mix: 43% best-in-class fashion; 21% to restaurant, food and social; balance to non-fashion and services
    • Average WAULT 9.5 years; 8.0 years WAULB
    • Strong leasing pipeline for 2023
  • Flagship occupancy +1% to 96% from half year; stable year-on-year
  • Rent collection normalising: 2022 now at 95%; Q1 2023 90%
  • Strong recovery in footfall and sales continues in Value Retail


Dividend

The payments of cash and enhanced scrip dividends approved by shareholders and made in 2022 have satisfied our REIT and SIIC distribution requirements for 2022. The Board will therefore not be recommending a further payment in respect of 2022 but continues to anticipate re-instating a cash dividend for 2023, which will be at least the minimum required to continue to meet our REIT/SIIC distribution obligations.

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Hammerson plc published this content on 09 March 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 March 2023 07:11:12 UTC.