The shares of Land Securities (LSE: LAND) dropped 1% to 970p this morning after the real estate giant delivered results in line with market expectations.
Land Securities, the biggest commercial property firm in the UK, revealed a profit before-tax of £398m for the six month period — a significant improvement on the £131m recorded last year.
This gain was mostly driven by a revaluation of the company’s substantial real estate base. With dividends included, the business delivered a 5.4% return for shareholders over the period, taking into account the 3.6% growth in Land Securities’ net asset value.
Giving his outlook for the rest of the year, chief executive Robert Noel added:
“Due to the highly competitive market, it is likely that sales of assets will exceed capital expenditure and acquisitions in the second half. While this will strengthen our balance sheet further, it is likely that revenue profit will be slightly lower than in the first half as we lose income from sales. With strong interest in our London developments, we expect to continue to deliver lettings ahead of our original expectations.”
With a market cap of £7.6bn, Land Securities shares trade at 26 times expected earnings, and offer a prospective dividend yield of 3.3%.