Coronavirus Update

The British Land Company Plc - Full Year Results

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The British Land Company PLC Full Year Results

27 May 2020

Chris Grigg, Chief Executive said: 

"Like businesses around the world, in recent months our focus has been on responding to the unprecedented challenges brought about by Covid-19.  We have acted quickly and effectively to support our customers, partners and local communities and to protect the long term value of our business.  Throughout this time, the safety and wellbeing of our team has been our key priority.  Now, more than ever, we are benefitting from their expertise and experience and across our business, they have demonstrated their commitment, resilience and good humour for which I and the Board are extremely grateful.

Over the year we made further good operational and strategic progress and this stands us in good stead today.  We have continued to lease well in London and committed developments are close to completion and nearly full, locking in £54m future rents.  We have a resolution to grant planning at Canada Water and opportunities throughout our pipeline which we can progress when the time is right.  This was already a difficult year for retailers, many of whom have been severely impacted by the lockdown and the early effects of the crisis were reflected in the value of our Retail portfolio.

More broadly, we expect the major trends that inform our strategy to accelerate.  This includes the shift to online retail, reinforcing our focus on delivering a more focused Retail business and we made progress on this with £296m of retail sales.  All of our offices are in London, and here we expect demand to further polarise towards safe, modern, sustainable and well located workspace. This is exactly what we deliver at our campuses.  Sustainability is a key part of that offer, and today we set out ambitious new targets which include delivering a net zero carbon portfolio by 2030.

Near term, we are expecting the offices market to be more cautious, but we continue to conduct virtual viewings and are encouraged by negotiations we are having.  In Retail, given current valuations and the lack of liquidity in the investment market, our focus is on delivering value though asset management, working to keep our places full and exploiting demand for assets which support an online offer. Our financial position is robust with debt low, significant covenant headroom and access to £1.3bn of undrawn facilities and cash so we are well placed to weather today's challenges and succeed in the long term ."

Update on financial position & operational impact of Covid-19

  • Financial strength and significant covenant headroom - well positioned for today's challenges
  • £1.3bn undrawn facilities and cash with no requirement to refinance until 2024; £450m ESG-linked RCF agreed in March 2020; further £925m of facilities extended
  • Significant headroom to debt covenants; the Group could withstand a further valuation fall of 45% before any mitigating actions; no income or interest cover covenants on Group unsecured debt
  • Debt remains low, with LTV at 34.0%; weighted average interest rate reduced to 2.5%
  • Operational performance - proactively supporting our customers to protect long term value
  • Smaller retail, food & beverage and leisure customers released from rental obligations for three months to June; financial impact in terms of lost rent of £2m
  • c.£35m of rent deferred to customers experiencing financial challenges as a result of Covid-19
  • 68% of March rent collected; 97% offices and 43 % retail
  • As previously announced, dividends are temporarily suspended.  As a result, FY20 dividend down 48%.  Dividends will resume at an appropriate level as soon as there is sufficient clarity of outlook
  • Refocusing our existing Community Investment Fund to respond to the crisis, including funding expert, strategic advice for community partners and employment support for staff at our retailers and suppliers
  • Well prepared for the future
  • All but two assets open and operational; 270 retail units trading representing 15% of total
  • Well placed to respond to new ways of shopping; retail parks more conducive to mission-based trips and social distancing more easily managed; benefitting from in-house property management business
  • Progressing 220,000 sq ft office deals under offer; further 160,000 sq ft in negotiation; responded to 375,000 sq ft of RFPs since the crisis began
  • 100 Liverpool Street now expected to PC in Q3 2020 and 1 Triton Square in Q2 2021


Summary performance

Year ended 31 March




Income statement




Underlying earnings per share 2




Underlying Profit




IFRS loss after tax




IFRS basic earnings per share




Dividend per share




Total accounting return ²




Balance sheet




Portfolio at valuation (proportionally consolidated)




EPRA Net Asset Value per share²




IFRS net assets




Loan to value ratio (proportionally consolidated)




Operational Statistics




Lettings and renewals

2.7m sq ft

2.3m sq ft


Gross investment activity




Committed and recently completed development

1.6m sq ft

1.6m sq ft


Sustainability Performance





AAA rating

AAA rating



4* and Green Star

4* and Green Star



Underlying resilience but performance impacted by Covid-19

  • Underlying EPS down 6.3% following £900m of net income producing sales over the last two years
  • Valuation decline led to IFRS loss of £1,114m
  • Portfolio value down 10.1%; Retail down 26.1%, Offices up 2.3% and developments up 6.5%
  • EPRA NAV down 14.5% at 774p

Progress on strategy: Becoming the specialist in mixed use

  • Campus-focused London Offices: Continued good progress across the year 
  • 946,000 sq ft of leasing activity representing £40m of headline rents; 97% occupancy
  • Lettings and renewals on the investment portfolio 9.1% ahead of ERV
  • Completed & committed developments 88% pre-let, adding £62m of rent when fully let
  • Significant development optionality within the portfolio. 7.1m sq ft near and medium term pipeline
  • Smaller, more focused Retail: Supporting our customers
  • 1,361,000 sq ft of leasing activity; deals of more than one year 4% below passing rents; 96% occupancy
  • £296m retail sales (our share), overall 5% ahead of book value
  • CVAs and administrations reducing annualised contracted rent by £11.3m
  • Secured resolution to grant planning for our Canada Water Masterplan; valuation up 9.8%

5 year 2020 sustainability programme completed; 2030 Sustainability Strategy launched

  • Key achievements from 2020 programme
  • 73% reduction in landlord carbon intensity
  • 55% reduction in landlord energy intensity over ten years
  • 1,745 people supported into jobs through Bright Lights, our skills and employment programme
  • New strategy launched; ambitious targets including a commitment to be net zero carbon by 2030
  • All future developments to be net zero carbon; 50% less embodied carbon on all major developments by 2030
  • 75% less carbon at our operations by 2030; Transition Fund established to finance retrofitting of standing portfolio, including R&D; funded by an internal price for carbon of £60/tonne
  • Rolling out successful place-based approach to community engagement across the portfolio