Town Centre Securities shares up on resilient results

Shares of Leeds-based property investor and car park operator Town Centre Securities (TCS) rose about 5% on Tuesday after it published results for the year ended June 30, 2020, that it said showed “resilience” amid the COVID-19 pandemic.

TCS said net asset value fell 17.4% to £155.5 million.

TCS cut its total dividend for the year to 5p from 11.75p in the previous year.

TCS shares have plunged about 50% over the past 12 months.

“We report a statutory loss for the year, on an IFRS 16 basis, of £24.2m, down £11.7m year on year, largely due to the negative impact the crisis has had on the value of our portfolio, which is down 6.9% year on year, with net asset value also down £32.8m or 17.4% to £155.5m,” said TCS chairman and chief executive Edward Ziff.

“These are clearly disappointing numbers, but with earnings impacted by £3.6m due to COVID-19, and our valuation results significantly better than other companies with less resilient retail portfolios; we are reassured by the resilience of our portfolio and our full compliance with all covenants.

“With our decision to accelerate asset sales and with significant progress already made post 30 June 2020, I firmly see this as an inflexion point from which we can successfully move forwards.”

TCS chairman and chief executive Edward Ziff, said: “The COVID-19 crisis has presented entirely new challenges for the business and for our stakeholders.

“I have been very reassured by the ability of the business to adapt in such circumstances and by the flexibility and resilience of our tenants and employees.

“The final third of our financial year was especially tough, but I believe the underlying strength of the business, together with our conservative focus on long-term, sustainable performance, as well as recent strategic changes to our portfolio, have enabled us to limit the worst impact of COVID-19.

“We are very disappointed to break our 60-year track record of delivering a maintained or increased dividend although we were pleased to be able to keep our commitment to pay the interim dividend.

“However, the unpredictable nature of the COVID-19 crisis has made the decision to reduce the full year dividend payment the right one for the business.

“Looking forward, the board is using this moment to reset and reinvigorate the business; we have determined that the overall strategy remains appropriate but requires acceleration particularly with regards to the disposal programme, as evidenced by the significant sales completed recently.

“This will affect future earnings and dividend levels, however we believe longer-term we shall emerge as a stronger business and look to the future with confidence.”

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