// Hammerson records full-year pre-tax loss of £266m
// Net rental income declined 6.2% to £347.5m
// Shopping centre giant pledges £500 million worth of disposals this year
Hammerson has pledged to focus on slimming down its portfolio as it swung to a significant loss after a year of retail failures put pressure on property values.
For the full-year period ending December 31, the shopping centre giant unveiled a loss before tax of £266.7 million, a stark contrast to the pre-tax profit of £413 million at the end of the previous year.
On an adjusted basis, profit fell 2.4 per cent to £240.3 million
However, net rental income declined 6.2 per cent to £347.5 million.
Hammerson chief executive David Atkins said 2018 was a “tough year, particularly in the UK”.
“Tenant failures, the structural shift in retail and a more considered consumer created a difficult operating environment, putting pressure on property values,” he said.
Major retailers such as Maplin and House of Fraser went into administration last year, while many others used a form of insolvency known as a CVA to shut stores.
At its flaghip UK destinations, Hammerson said net rental income had dropped by 1.3 per cent and while retail parks fell by 4.3 per cent due to tenant failures and CVAs.
Meanwhile, the value of the company’s portfolio both in the UK and abroad dropped 5.9 per cent to £9.94 billion.
Hammerson said its property values dropped by an average of four per cent during 2018, including a reduction in UK values of 11 per cent.
The company said it expected further weakness in the UK until the outcome of Brexit is determined.
Hammerson also sold off £570 million worth of its assets in 2018, with plans to dispose another £500 million worth of assets in the current year.
It has set up an Investment and Disposal Committee to ramp up its focus on slimming down the portfolio, while the company said it was in talks over possible transactions with a total value of up to £900 million.