Birmingham Bullring owner Hammerson swings to a profit

Shopping centres group Hammerson has swung to a first-half pre-tax profit as footfall recovered to near pre-pandemic levels and costs fell.

Hammerson owns the Bullring and Grand Central in Birmingham
Hammerson owns the Bullring and Grand Central in Birmingham

The group, which owns the Bullring and Grand Central in Birmingham, has reported a pre-tax profit of £50.3 million compared with a loss of £375.5 million for the same period a year earlier.

The company said this reflects a 48 per cent increase in like-for-like net rental income, lower administration and finance costs and strong contributions from its Value Retail holding.

It also saw revenue fall to £62 million from £65.3 million.

The company said footfall at the end of the second quarter strengthened to 90 per cent of 2019 levels, the closest pre-pandemic comparator. Sales, occupancy and rent collection also improved toward pre-pandemic levels.

In Birmingham, it said it was progressing with designs and feasibility for a major repositioning of Grand Central alongside its partner Canada Pension Plan Investment Board to create an "amenity rich workspace-led proposal" served by New Street Station.

Rita-Rose Gagné, chief executive, said: “We continued to make good strategic, financial and operational progress in the first half. Adjusted earnings were up 154 per cent to £51 million reflecting a 48 per cent increase in like-for-like net rental income, lower administration and finance costs, and a strong contribution from Value Retail.

"We completed £194 million of disposals, reducing net debt by six per cent. Portfolio values were broadly stable in the half and we have a solid balance sheet.

"Footfall, sales, occupancy and collections are recovering and now close to 2019 levels. We saw a good leasing performance now ahead of previous passing rent. We have strengthened our tenant profile, we have a strong and diversified leasing pipeline for the second half, and robust occupancy levels across our destinations.

"We have also continued to make progress on our pre-development pipeline, with key milestones in the first half met that enable further options for value creation.

"We are a better, more resilient, and financially secure business as a result of the actions taken since the beginning of 2021. We are conscious of the potentially volatile environment ahead and remain focussed on delivering our strategy. We see more opportunities ahead.”

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