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Hammerson plc - Half Year 2024 Results
Hammerson plc
(Incorporated in England and Wales)
(Company number 360632)
LSE and Euronext Dublin share code: HMSO JSE share code: HMN
ISIN: GB00BK7YQK64
("Hammerson" or "the Company")
HAMMERSON plc – HALF YEAR 2024 RESULTS
Building on strong first half with transformational disposal to accelerate growth and value creation
Rita-Rose Gagné, Chief Executive of Hammerson, said:
"I am pleased to report we've had a strong first half. We are realising the benefits of our investments in recent years and with the
agreed disposal of Value Retail, we now have the capacity and capability to accelerate growth and value creation. Our leading city
centre destinations are in high demand, supported by our ongoing investment and repositioning. This is evidenced by another year-
on-year increase in leasing, up 24%. This is driving top line growth with more to come.
At the same time, we have delivered another outperformance on costs, down 16% year on year. In the first half, we also completed
our £500m disposals programme, realigning our core portfolio to leading city centre destinations, whilst further strengthening the
balance sheet. We now have a strong, scalable platform as we look to drive further operating leverage.
I am excited by the opportunity ahead and confident we will continue to grow the top-line and earnings off our new base, reflected in
the 5% increase in the interim dividend."
Strong first half and transformational £1.5bn[1] transaction generating cash proceeds of c.£600m
• Adjusted earnings of £50m (HY 23: £56m), reflecting impact of disposals. Adjusted EPS 1.0p (HY 23: 1.1p)
• Disposal of non-controlling and yield dilutive interest in Value Retail announced 22 July 2024 ensures clean exit from complex
structure at an attractive price, generating c.£600m in cash proceeds
• The Company intends to use proceeds for a combination of: immediate significant deleveraging; reinvestment into higher
yielding assets; and a return of up to £140m to shareholders via a share buy back
• Loss for the period (IFRS) of £517m (HY 23: £(1)m), predominantly reflecting impairment of investment in Value Retail from
carrying value of £1.1bn. Loss per share (10.4)p (HY 23: (0.0)p)
• Managed Group portfolio value of £2.6bn broadly flat excluding disposals, with revaluation gains in UK and France due to ERV
growth. Irish revaluation loss due to yield expansion
• NTA per share 38p (FY 23: 51p)
• Headline LTV of 39% and net debt:EBITDA of 8.0x. On a pro forma basis, reflecting the disposal of the Group's interest in
Value Retail, LTV falls to 25% with net debt:EBITDA of 5.3x
Continued operational and leasing momentum driving top line growth; costs further reduced:
• Like-for-like ('LFL') GRI +2%, LFL NRI +2%. Excluding Cabot Circus, in repositioning, LFL GRI +4%; LFL NRI +5%
• Leasing value up 24% year-on-year to £23m, or £13m at share, from 140 deals
• Positive leasing spreads maintained: permanent deals signed +61% vs previous passing (+29% excluding nil previous passing
rent); net effective rent +10% vs ERV
• Robust 94% occupancy whilst undertaking proactive repositioning
• Footfall up +1% year-on-year (+2% excluding Cabot Circus); new occupier sales densities c.20% higher than previous occupiers
• Continued cost reduction outperformance with gross administration cost -16% year-on-year, which will deliver in excess of
30% cost reduction since FY 20 by FY 24
Dividend
The Board today declares an interim dividend in respect of 2024 of 0.756p pence per share, up 5% year-on-year and a payout ratio
of 76% reflecting the Board's confidence in future earnings growth and which will be paid as a PID. The Board intends to increase
the policy payout ratio from its current policy of 60-70% to 80-85% following the completion of the sale of Value Retail. The dividend
declaration will be released as a separate announcement.
Medium-term financial framework
After three years of intensive turnaround, we have entered a new phase with the capacity and capability to invest to accelerate
growth. We have realigned our portfolio to ten dominant city centre destinations, 93% of which are A rated by Green Street and are
highly attractive to both visitors and best-in-class occupiers. We continue to reposition our assets, alongside enhanced placemaking,
commercialisation and digital marketing, responding both to visitor and occupier demand and to stay ahead of evolving trends and
the competition. We have a strong platform with long-term visibility of income. This backdrop informs our medium term financial
framework[2], announced on 22 July 2024, following the disposal of the Group's interest in Value Retail:
• GRI CAGR: 4-6%
• EPS CAGR: 6-8%
• DPS CAGR: 6-8%
• Annualised TAR: c.10% (assuming stable yields)
Share consolidation and Capital Reduction to increase distributable reserves
As announced on 22 July, Hammerson is proposing to simplify its share capital through a 1 for 10 share consolidation, and to
increase distributable reserves by reducing the Company's share premium account. A Circular with more detail, and a notice
convening a general meeting, will be sent to shareholders in due course.
Results presentation today:
Hammerson will hold a virtual presentation for analysts and investors to present its financial results for the six months ended 30 June
2024, followed by a Q&A session.
Date & time: Thursday 25 July 2024 at 08.30 am (BST)
Webcast link: https://hammerson-2024-hy-results.open-exchange.net
Conference call: Quote Hammerson when prompted by the operator, access code 178798
Please join the call five minutes before the booked start time to allow the operator to transfer you into the call by the
scheduled start time
France: +33 9 7073 3958 South Africa: +27 87 550 8441
Ireland: +353 1 691 7842 UK: +44 20 3936 2999
Netherlands: +31 85 888 7233 USA: +1 646 787 9445
The presentation and press release will be available at: https://www.hammerson.com/investors/reports-results-
presentations on the morning of results.
Enquiries:
Rita-Rose Gagné, Chief Executive Officer Tel: +44 (0)20 7887 1000
Himanshu Raja, Chief Financial Officer Tel: +44 (0)20 7887 1000
Josh Warren, Director of Strategy, Commercial Finance and IR Tel: +44 (0)20 7887 1053 josh.warren@hammerson.com
Oliver Hughes, Ollie Hoare and Charles Hirst, MHP Tel: +44 (0)20 3128 8100 Hammerson@mhpgroup.com
Disclaimer
Certain statements made in this document are forward looking and are based on current expectations concerning future
events which are subject to a number of assumptions, risks and uncertainties. Many of these assumptions, risks and
uncertainties relate to factors that are beyond the Group's control and which could cause actual results to differ materially
from any expected future events or results referred to or implied by these forward-looking statements. Any forward-
looking statements made are based on the knowledge and information available to Directors on the date of publication of
this announcement. Unless otherwise required by applicable laws, regulations or accounting standards, the Group does not
undertake any obligation to update or revise any forward-looking statements, whether as a result of new information,
future developments or otherwise. Accordingly, no assurance can be given that any particular expectation will be met, and
reliance should not be placed on any forward-looking statement. Nothing in this announcement should be regarded as a
profit estimate or forecast.
This announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to
subscribe for or purchase any shares or other securities in the Company or any of its group members, nor shall it or any
part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment or
investment decisions relating thereto, nor does it constitute a recommendation regarding the shares or other securities of
the Company or any of its group members. Statements in this announcement reflect the knowledge and information
available at the time of its preparation. Liability arising from anything in this announcement shall be governed by English
law. Nothing in this announcement shall exclude any liability under applicable laws that cannot be excluded in accordance
with such laws.
[1] £1.5bn transaction reflects enterprise value, see separate transaction announcement dated 22 July 2024 on www.hammerson.com for details
[2] Assuming timely reinvestment of net proceeds and completion of the share buy back. Outcomes for shorter periods will be highly dependent on
activity levels and prevailing market conditions, with variances across different segments of the Group's portfolio.
Index to key data
Six months ended 30 June 2024 30 June 2023 Note/Ref1
Income
Gross rental income[2] £94.4m £106.3m 2
Adjusted net rental income[2] £72.7m £85.1m 2
Adjusted earnings – Value Retail £11.7m £13.4m 2
Adjusted net finance costs[2] £(18.7)m £(25.1)m 2
Adjusted earnings[3] £49.5m £55.9m 2
Revaluation losses – Managed portfolio[2] £(47.8)m £(43.8)m 2
Loss for the period (IFRS) £(516.7)m £(1.2)m 2
Adjusted earnings per share3 1.0p 1.1p 11B
Basic loss per share (10.4)p (0.0)p 11B
Interim dividend per share (cash) 0.756p 0.72p 18
Operational
Like-for-like gross rental income change[2] 2.1% 3.1% Financial Review
Like-for-like net rental income change[2] 1.7% 2.3% Table 3
Occupancy – flagships[2] 94.3% 95.1% Table 5
Leasing value[2] £13.3m £10.7m n/a
Leasing v ERV (principal leases)[2] +10% +8% n/a
Leasing v Passing rent (principal leases)[2] +61% +20% n/a
Passing rent[2] £170.0m £184.5m Table 4
Like-for-like passing rent change[2] 0.7% 4.2% n/a
ERV[2] £178.3m £183.0m Table 4
Like-for-like ERV change – flagships[2] 0.9% 0.1% Financial Review
Capital and financing
As at 30 June 2024 31 December 2023
Valuation – Managed portfolio[2] £2,579m £2,776m 3B
Total accounting return[3] (23.4)% (2.1)% Table 15
Total property return - Managed portfolio[2] 0.6% 1.6% Table 9
Capital return – Managed portfolio[2] (2.2)% (4.1)% Table 9
Net debt[2] £1,220m £1,326m Table 13
Gearing[2] 65% 55% Table 18
Loan to value – headline[2] 39% 34% Table 20
Liquidity £1,138m £1,225m Financial Review
Interest cover[2] 4.21x 3.91x Table 17
Net debt:EBITDA (rolling 12 months)[2] 8.0x 8.0x Table 16
Net assets £1,908m £2,463m Balance sheet
EPRA net tangible assets (NTA) per share[3] 38p 51p 11C
Key pro forma metrics for Value Retail disposal[4] 30 June 2024 31 December 2023
Net debt[2] £637m n/a Financial review
Liquidity £1,721m n/a Financial review
Loan to value[2] 25% n/a Table 20
Gearing[2] 34% n/a Table 18
Net debt:EBITDA[2] 5.3x n/a Table 16
[1] Note/Ref to notes in the interim financial statements, tables in Additional Information or other sections of this release.
[2] Figures presented on a proportionally consolidated basis, excluding Value Retail, as per management reporting. See 'Presentation of financial
information' section of the Financial Review for explanation.
[3] These results include discussion of alternative performance measures (APMs) which include those described as Adjusted, EPRA and Headline.
These are described on page 9 of the Financial Review and reconciliations for earnings and net assets measures to their IFRS equivalents are
set out in note 10 to the interim financial statements.
[4] Reflects the impact of the disposal of the Group's interest in Value Retail announced on 22 July 2024, see note 9 to the interim financial
statements for details.
Extract from the unaudited 2024 half year results:
This short form announcement is the responsibility of the Directors of the Company and has not been audited or reviewed by the
Company's auditors. The information disclosed is only a summary of the information in the full announcement and does not
contain full or complete details. The full unaudited 2024 half year results announcement should be considered for any investment
decisions. The full unaudited 2024 half year results announcement for Hammerson plc is available for viewing at
https://senspdf.jse.co.za/documents/2024/jse/isse/HMNE/HY2024.pdf and on the Company's website at
www.hammerson.com/investors. Copies of the full announcement may be requested from the Company's investor relations
department by emailing investorrelations@hammerson.com.
Hammerson has its primary listing on the London Stock Exchange and secondary inward listings on the Johannesburg Stock
Exchange and Euronext Dublin.
Sponsor:
Investec Bank Limited
Date: 25-07-2024 08:00:00
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