February 10, 2005

By Dirk De Vynck

Cape Town - Liberty International, the listed property company that owns six of the top 18 shopping centres in the UK, has increased its annual pretax profit before exceptional items by 11 percent to £115.7 million (R1.34

billion) in a year described by the company as one of the most active and successful in its 25 years of existence.

Apart from the 22 percent shareholding that Donald Gordon, the chairman, and his family holds in Liberty International, South Africans hold 35 percent, UK citizens hold 18 percent, and others, including shareholders from the US and continental Europe, hold 25 percent.

The adjusted earnings per share rose 5.7 percent to 29p, while the final dividend of 14.1p brought the full-year to December's dividend to 26.5p, an increase of 6 percent on 2003.

The revaluation of the property portfolio has led to a surplus of £343 million, which has increased the adjusted net asset value by 12.3 percent to £10.17 per share.

The entire Liberty International property portfolio was valued at £5.3 billion at the end of last year.

Len van Niekerk, property analyst at Andisa Securities, said the results were slightly ahead of his expectations. Overall, the performance was solid.

The debt-to-assets ratio declined from 39 percent to 36 percent, with borrowings unchanged at £1.92 billion. Cash balances stood at £438 million, while there was committed financing facilities of £675 million.

David Fischel, the chief executive of Liberty International, said at the end of last year there were only 11 vacancies out of 1 400 shops.

The year under review was a very busy one, with £221 million invested in acquisitions, while £321 million was spent on developments and upgrades.

As for future developments, the group has set out about £1.3 billion, focusing primarily on new and existing regional shopping centres.

Of this, £350 million is already committed. In the year, the company disposed of £284.6 million worth of non-core assets, which included a non-direct property investment of 25 percent in Great Portland Estates.

Fischel said it was the group's intention to progressively get out of the office property market and to focus primarily on retail property.

He continued it was unlikely the group would trade outside the UK, where 95 percent of its assets are, or the US, where the remaining 5 percent of its assets are.

Last year saw the highest improvement in the share price since the group was incorporated in 1980.

However, Van Niekerk noted the good share price performance was not only Liberty International's doing, as the whole listed property sector had a very good year.

Liberty International has its primary listing in London and its secondary listing in Johannesburg. Its share price yesterday closed 4c higher at R115.70, while the real estate sector gained 0.37 percent.