REG - British Land Co PLC - Half-year Report - Part 2 <Origin Href="QuoteRef">BLND.L</Origin>

British LandAnnouncement

16/11/2017 07:07

RNS Number : 6459W
British Land Co PLC
16 November 2017
The British Land Company PLC
Consolidated income statement
For the six months ended 30 September 2017
Six months ended 
30 September 2017
Unaudited
Six months ended
30 September 2016
Unaudited
Note
Underlying
pre-tax1
m
Capital
and other
m
Total
m
Underlying
pre-tax1
m
Capital
and other
m
Total
m
Revenue
3
282
50
332
288
9
297
Costs
3
(68)
(42)
(110)
(67)
(6)
(73)
3
214
8
222
221
3
224
Joint ventures and funds
(see also below)
8
64
9
73
68
(199)
(131)
Administrative expenses
(40)
-
(40)
(42)
-
(42)
Valuation movement
4
-
141
141
-
(257)
(257)
Profit on disposal of investment properties and investments
-
20
20
-
27
27
Net financing costs
- financing income
5
-
-
-
2
32
34
- financing charges
5
(34)
(144)
(178)
(43)
(17)
(60)
(34)
(144)
(178)
(41)
15
(26)
Profit (loss) on ordinary activities
before taxation
204
34
238
206
(411)
(205)
Taxation
6
-
7
7
-
1
1
Profit (loss) for the period after taxation
245
(204)
Attributable to non-controlling interests
6
-
6
7
(16)
(9)
Attributable to shareholders
of the Company
198
41
239
199
(394)
(195)
Earnings per share:
- basic
2
23.2p
(19.0)p
- diluted
2
23.2p
(20.3)p
All results derive from continuing operations.
Six months ended 
30 September 2017
Unaudited
Six months ended
30 September 2016
Unaudited
Note
Underlying
pre-tax1
m
Capital
and other
m
Total
m
Underlying
pre-tax1
m
Capital
and other
m
Total
m
Results of joint ventures and funds accounted for using the equity method
Underlying Profit
64
-
64
68
-
68
Valuation movement
4
-
26
26
-
(205)
(205)
Capital financing costs
-
(9)
(9)
-
(6)
(6)
(Loss) profit on disposal of investment properties, trading properties
and investments
-
(8)
(8)
-
12
12
Taxation
-
-
-
-
-
-
8
64
9
73
68
(199)
(131)
1 See definition in glossary.
consolidated statement OF COMPREHENSIVE INCOME
For the six months ended 30 September 2017
Six months ended 30 September 2017
Unaudited
m
Six months ended 30 September 2016
Unaudited
m
Profit (loss) for the period after taxation
245
(204)
Other comprehensive income (expense):
Items that will not be reclassified subsequently to profit or loss:
Net actuarial gain (loss) on pension scheme
4
(23)
Valuation movements on owner-occupied properties
(3)
(2)
1
(25)
Items that may be reclassified subsequently to profit or loss:
Gains (losses) on cash flow hedges
- Group
7
(47)
- Joint ventures and funds
1
(3)
8
(50)
Transferred to the income statement (cash flow hedges)
- Interest rate derivatives
129
10
129
10
Exchange differences on translation of foreign operations
- Hedging and translation
-
-
-
-
Deferred tax on items of other comprehensive income
(4)
-
Other comprehensive profit (expense) for the period
134
(65)
Total comprehensive income (expense) for the period
379
(269)
Attributable to non-controlling interests
7
(10)
Attributable to shareholders of the Company
372
(259)
consolidated BALANCE SHEET
AS AT 30 SEPTEMBER 2017
Note
30 September 2017
Unaudited
m
31 March
2017
Audited
m
ASSETS
Non-current assets
Investment and development properties
7
9,373
9,073
Owner-occupied property
7
91
94
9,464
9,167
Other non-current assets
Investments in joint ventures and funds
8
2,764
2,766
Other investments
9
158
154
Deferred tax assets
5
4
Interest rate and currency derivative assets
10
175
217
12,566
12,308
Current assets
Joint venture held for sale
8
-
540
Trading properties
7
330
334
Debtors
49
171
Cash and short-term deposits
10
119
114
498
1,159
Total assets
13,064
13,467
LIABILITIES
Current liabilities
Short-term borrowings and overdrafts
10
(59)
(464)
Creditors
(328)
(458)
Corporation tax
(28)
(30)
(415)
(952)
Non-current liabilities
Debentures and loans
10
(2,813)
(2,817)
Other non-current liabilities
(73)
(78)
Interest rate and currency derivative liabilities
10
(131)
(144)
(3,017)
(3,039)
Total liabilities
(3,432)
(3,991)
Net assets
9,632
9,476
EQUITY
Share capital
257
260
Share premium
1,299
1,298
Merger reserve
213
213
Other reserves
32
(97)
Retained earnings
7,577
7,547
Equity attributable to shareholders of the Company
9,378
9,221
Non-controlling interests
254
255
Total equity
9,632
9,476
EPRA NAV per share*
939p
915p
* See definition in glossary.
consolidated statement OF CASH FLOWS
For the six months ended 30 September 2017
Note
Six months ended 30 September 2017
Unaudited
m
Six months ended 30 September 2016
Unaudited
m
Rental income received from tenants
225
241
Fees and other income received
34
31
Operating expenses paid to suppliers and employees
(94)
(86)
Cash generated from operations
165
186
Interest paid
(30)
(50)
Interest received
4
2
Corporation tax payments
(1)
-
Distributions and other receivables from joint ventures and funds
8
45
25
Net cash inflow from operating activities
183
163
Cash flows from investing activities
Development and other capital expenditure
(101)
(109)
Purchase of investment properties
(57)
(72)
Sale of investment and trading properties
85
436
Payments received in respect of future trading property sales
-
4
Purchase of investments
(2)
(15)
Investment in and loans to joint ventures and funds
(137)
(27)
Disposal of joint venture held for sale
570
-
Proceeds from disposal of joint venture with Tesco
68
-
Capital distributions and loan repayments from joint ventures and funds
3
64
Indirect taxes paid in respect of investing activities
(8)
(9)
Net cash inflow from investing activities
421
272
Cash flows from financing activities
Issue of ordinary shares
1
2
Purchase of ordinary shares
(66)
(8)
Dividends paid
(151)
(150)
Dividends paid to non-controlling interests
(8)
(6)
Acquisition of units in Hercules Unit Trust
-
(12)
Closeout of interest rate derivatives
(16)
(11)
Decrease in bank and other borrowings
(766)
(297)
Drawdown on bank and other borrowings
407
40
Net cash outflow from financing activities
(599)
(442)
Net increase (decrease) in cash and cash equivalents
5
(7)
Cash and cash equivalents at 1 April
114
114
Cash and cash equivalents at 30 September
119
107
Cash and cash equivalents consists of:
Cash and short-term deposits
119
107
Consolidated Statement of Changes in Equity
For the six months ended 30 September 2017
Six month movements in equity
Share capital
m
Share premium
m
Hedging and translation reserve
m
Re-
valuation
reserve
m
Merger reserve
m
Retained earnings
m
Total
m
Non-controlling interests
m
Total
equity
m
Balance at 1 April 2017
260
1,298
(112)
15
213
7,547
9,221
255
9,476
Total comprehensive income for the period
-
-
131
(2)
-
243
372
7
379
Share issues
-
1
-
-
-
-
1
-
1
Fair value of share and share option awards
-
-
-
-
-
-
-
-
-
Purchase of own shares
(3)
-
-
-
-
(63)
(66)
-
(66)
Dividends payable in period (14.60p per share)
-
-
-
-
-
(150)
(150)
-
(150)
Dividends paid to non-controlling interests
-
-
-
-
-
-
-
(8)
(8)
Balance at 30 September 2017
257
1,299
19
13
213
7,577
9,378
254
9,632
Balance at 1 April 2016
260
1,295
(107)
14
213
7,667
9,342
277
9,619
Total comprehensive income for the period
-
-
(36)
(5)
-
(218)
(259)
(10)
(269)
Share issues
-
2
-
-
-
-
2
-
2
Fair value of share and share option awards
-
-
-
-
-
1
1
-
1
Purchase of units from non-controlling interests
-
-
-
-
-
(8)
(8)
-
(8)
Dividends payable in period (14.18p per share)
-
-
-
-
-
-
-
(12)
(12)
Dividends payable by subsidiaries
-
-
-
-
-
(146)
(146)
-
(146)
Adjustment for scrip dividend element
-
-
-
-
-
-
-
(6)
(6)
Balance at 30 September 2016
260
1,297
(143)
9
213
7,296
8,932
249
9,181
Prior year movements in equity
Share capital
m
Share premium
m
Hedging and translation reserve
m
Re-
valuation
reserve
m
Merger reserve
m
Retained earnings
m
Total
m
Non-controlling interests
m
Total
equity
m
Balance at 1 April 2016
260
1,295
(107)
14
213
7,667
9,342
277
9,619
Total comprehensive income for the period
-
-
(5)
1
-
181
177
3
180
Share issues
-
3
-
-
-
-
3
-
3
Fair value of share and share option awards
-
-
-
-
-
2
2
-
2
Purchase of own shares
-
-
-
-
-
(8)
(8)
-
(8)
Purchase of units from non-controlling interests
-
-
-
-
-
-
-
(11)
(11)
Gain on purchase of units from non-controlling interests
-
-
-
-
-
1
1
-
1
Dividends payable in year (28.8p per share)
-
-
-
-
-
(296)
(296)
-
(296)
Dividends payable by subsidiaries
-
-
-
-
-
-
-
(14)
(14)
Balance at 31 March 2017
260
1,298
(112)
15
213
7,547
9,221
255
9,476
Notes to the accounts for the six months ended 30 September 2017
1Basis of preparation
The financial information for the period ended 30 September 2017 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for the year ended 31 March 2017 has been delivered to the Registrar of Companies. The auditors' report on those accounts was not qualified, did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report, and did not contain statements under section 498(2) or (3) of the Companies Act 2006.
The financial information included in this announcement has been prepared on a going concern basis using accounting policies consistent with International Financial Reporting Standards (IFRS) as adopted by the European Union and in accordance with IAS 34 Interim Financial Reporting. The current period financial information presented in this document has been reviewed, not audited.
The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 March 2017, which have been prepared in accordance with IFRS as adopted by the European Union.
The same accounting policies, estimates, presentation and methods of computation are followed in the half year report as applied in the Group's latest annual audited financial statements, with the exception of the tax policy, which for the interim period is as follows: The current tax charge is calculated on profits arising in the period and in accordance with legislation which has been enacted or substantially enacted at the balance sheet date.
A number of new standards and amendments to standards and interpretations have been issued but are not yet effective for the current accounting period. None of these are expected to have a material impact on the consolidated financial statements of the Group, except the following set out below:
IFRS 9 - Financial Instruments - the new standard addresses the classification, measurement and recognition of financial assets and financial liabilities. It simplifies the existing categories of financial instruments, introduces an expected credit loss model and redefines the criteria required for hedge effectiveness. On adoption of the new standard, these changes are not expected to have a material impact on the consolidated financial statements of the Group. There will however be changes to presentation and disclosure.
IFRS 15 - Revenue from contracts with customers - the new standard combines a number of previous standards, setting out a five step model for the recognition of revenue and establishing principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts with customers. The new standard does not apply to gross rental income, but does apply to service charge income, management and performance fees and trading property disposals. The impact of the new standard on these items of revenue is not expected to have a material impact on the consolidated financial statements of the Group.
IFRS 16 - Leases, is effective for the Group's year ending 31 March 2020. For lessees, it will result in almost all leases being recognised on the balance sheet, as the distinction between operating and finance leases will be removed. The accounting for lessors will however not significantly change. As a result on adoption of the new standard, these changes are not expected to have a material impact on the consolidated financial statements of the Group.
The Group conducted an impact assessment of the above new standards in the prior year, and concluded that whilst adoption of these new standards based on the Group's current activities would lead to some limited changes to presentation and disclosure, they are not expected to have a material impact on the consolidated financial statements.
The Directors believe that the Group is well placed to manage its financing and other business risks satisfactorily, and have a reasonable expectation that the Company and the Group have adequate resources to continue in operation for at least 12 months from the signing date of these financial statements. They therefore consider it appropriate to adopt the going concern basis of accounting in preparing the financial statements.
The interim financial information was approved by the Board on 15 November 2017.
2Performance measures
Earnings per share
The Group measures financial performance with reference to underlying earnings per share, the European Public Real Estate Association (EPRA) earnings per share and IFRS earnings per share. The relevant earnings and weighted average number of shares (including dilution adjustments) for each performance measure are shown below, and a reconciliation between these is shown within the supplementary disclosures (Table B).
EPRA earnings per share is calculated using EPRA earnings, which is the IFRS profit after taxation attributable to shareholders of the Company excluding investment and development property revaluations, gains/losses on investing and trading property disposals, changes in the fair value of financial instruments and associated close-out costs and their related taxation.
On 10 September 2017, the 2012 convertible bond was redeemed at par, therefore there is no dilutive impact in relation to this instrument for either EPRA or IFRS measures in the current period. In the prior period, EPRA measures excluded the dilutive impact of the 2012 convertible bond as the Group's share price was below the exchange price of 693 pence. IFRS measures included the dilutive impact of the 2012 convertible bond as IAS 33 ignores this hurdle to conversion.
Underlying earnings per share is calculated using Underlying Profit adjusted for underlying taxation (see note 6). Underlying Profit is the pre-tax EPRA earnings measure, with additional Company adjustments. No Company adjustments were made in either the current or prior period.
Six months ended 30 September 2017
Six months ended 30 September 2016
Relevant
earnings
m
Relevant 
number
of shares
million
Earnings
per share
pence
Relevant
earnings
m
Relevant
number
of shares
million
Earnings
per share
pence
Underlying
Underlying basic
198
1,028
19.3
199
1,029
19.3
Underlying diluted
198
1,031
19.2
199
1,033
19.3
EPRA
EPRA basic
198
1,028
19.3
199
1,029
19.3
EPRA diluted
198
1,031
19.2
199
1,033
19.3
IFRS
Basic
239
1,028
23.2
(195)
1,029
(19.0)
Diluted
239
1,031
23.2
(221)
1,091
(20.3)
Net asset value
The Group measures financial position with reference to EPRA net asset value (NAV) per share and EPRA triple net asset value (NNNAV) per share. The net asset value and number of shares for each performance measure is shown below. A reconciliation between IFRS net assets and EPRA net assets, and the relevant number of shares for each performance measure, is shown within the supplementary disclosures (Table B). EPRA net assets is a proportionally consolidated measure that is based on IFRS net assets excluding the mark-to-market on derivatives and related debt adjustments, the mark-to-market on the convertible bonds as well as deferred taxation on property and derivative valuations. They include the valuation surplus on trading properties and are adjusted for the dilutive impact of share options.
As at 30 September 2017, neither EPRA NAV, NNNAV nor IFRS net assets included the impact of the 2012 convertible bond, as the bond was redeemed at par on 10 September 2017. As at 31 March 2017, EPRA NAV and NNNAV did not include the dilutive impact of the 2012 convertible bond, as the Group's share price was below the exchange price of 693 pence. IFRS net assets included the dilutive impact following the treatment of IFRS earnings per share.
30 September 2017
31 March 2017
Relevant
net assets
m
Relevant
number
of shares
million
Net asset
value per
share
pence
Relevant
net assets
m
Relevant
number
of shares
million
Net asset
value per
share
pence
EPRA
EPRA NAV
9,646
1,027
939
9,498
1,038
915
EPRA NNNAV
9,117
1,027
888
8,938
1,038
861
IFRS
Basic
9,632
1,019
945
9,476
1,029
921
Diluted
9,632
1,027
938
9,876
1,096
901
Total accounting return
The Group also measures financial performance with reference to total accounting return. This is calculated as the movement in EPRA net asset value per share and dividend paid in the period as a percentage of the EPRA net asset value per share at the start of the period.
Six months ended 30 September 2017
Six months ended 30 September 2016
Increase in NAV per share
pence
Dividend per share paid
pence
Total
accounting
return
Decrease in NAV per share
pence
Dividend per
share paid
pence
Total
accounting
return
Total accounting return
24
14.60
4.2%
(28)
14.18
(1.5%)
3Revenue and costs
Six months ended 
30 September 2017
Six months ended
30 September 2016
Underlying
m
Capital
and other
m
Total
m
Underlying
m
Capital
and other
m
Total
m
Rent receivable
221
-
221
226
-
226
Spreading of tenant incentives and guaranteed rent increases
(5)
-
(5)
(4)
-
(4)
Surrender premia
6
-
6
2
-
2
Gross rental income
222
-
222
224
-
224
Trading property sales proceeds
-
50
50
-
9
9
Service charge income
33
-
33
40
-
40
Management and performance fees
(from joint ventures and funds)
3
-
3
3
-
3
Other fees and commissions
24
-
24
21
-
21
Revenue
282
50
332
288
9
297
Trading property cost of sales
-
(42)
(42)
-
(6)
(6)
Service charge expenses
(33)
-
(33)
(40)
-
(40)
Property operating expenses
(15)
-
(15)
(10)
-
(10)
Other fees and commissions expenses
(20)
-
(20)
(17)
-
(17)
Costs
(68)
(42)
(110)
(67)
(6)
(73)
214
8
222
221
3
224
4Valuation movements on property
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Consolidated income statement
Revaluation of properties1
141
(257)
Revaluation of properties held by joint ventures and funds accounted for using the equity method
26
(205)
167
(462)
Consolidated statement of comprehensive income
Revaluation of owner-occupied properties
(3)
(2)
164
(464)
1 Includes 3m impairment of trading property in the current period (see note 7).
5Net financing costs
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Underlying
 
Financing charges
Bank loans, overdrafts and derivatives
(11)
(18)
Other loans
(25)
(28)
Obligations under head leases
(1)
(1)
(37)
(47)
Development interest capitalised
3
4
(34)
(43)
Financing income
Deposits, securities and liquid investments
-
2
Loans to joint ventures
-
2
Net financing charges - underlying
(34)
(41)
Capital and other
Financing charges
Hedging reserve recycling1
(115)
-
Valuation movements on fair value debt
43
(88)
Valuation movements on fair value derivatives
(44)
90
Recycling of fair value movement on close-out of derivatives
(14)
(10)
Capital financing costs
(6)
(5)
Fair value movement on convertible bonds
(1)
-
Fair value movement on non-hedge accounted derivatives
(7)
(4)
(144)
(17)
Financing income
Fair value movement on convertible bonds
-
32
-
32
Net financing income (charges) - capital
(144)
15
Total financing income
-
34
Total financing charges
(178)
(60)
Net financing costs
(178)
(26)
Interest on development expenditure is capitalised at the Group's weighted average interest rate of 2.1% (Six months ended 30 September 2016: 2.5%). The weighted average interest rate on a proportionately consolidated basis at 30 September 2017 was 3.0% (Six months ended 30 September 2016: 3.2%).
1 Represents a reclassification adjustment of cumulative losses within the hedging and translation reserve to capital profit and loss, in relation to a hedging instrument which is no longer hedge accounted. The recognition of this amount in capital financing charges has no impact on EPRA NAV. The impact of liability management undertaken in the period was a reduction of 3 pence on EPRA NAV per share.
6Taxation
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Taxation income 
Current taxation
Current period UK corporation taxation (30 September 2017: 19%; 30 September 2016: 20%)
-
1
Adjustments in respect of prior periods 
1
-
Total current taxation income 
1
1
Deferred taxation on revaluations and derivatives
6
-
Group total taxation
7
1
Attributable to joint ventures and funds
-
-
Total taxation income
7
1
Taxation expense attributable to Underlying Profits for the six months ended 30 September 2017 was nil (Six months ended 30 September 2016: nil).
7Property
Property reconciliation
Six months ended 30 September 2017
Year ended 31 March 2017 
Investment and development properties
Level 3
m 
Trading properties
m 
Owner-occupied
Level 3
m 
Total
m 
Investment and development properties
Level 3
m
Trading properties
m
Owner-occupied
Level 3
m
Total
m
Carrying value at the start of the
period/year
9,073
334
94
9,501
9,643
325
95
10,063
Additions
- property purchases
137
5
-
142
88
-
-
88
- development expenditure
21
33
-
54
81
56
-
137
- capitalised interest and staff costs
3
2
-
5
5
5
-
10
- capital expenditure on asset management initiatives
34
-
-
34
92
-
-
92
195
40
-
235
266
61
-
327
Depreciation
-
-
-
-
-
-
(1)
(1)
Disposals
(37)
(41)
-
(78)
(670)
(26)
-
(696)
Reclassifications
-
-
-
-
27
(27)
-
-
Revaluations included in income statement
144
(3)
-
141
(144)
-
-
(144)
Revaluations included in OCI
-
-
(3)
(3)
-
-
-
-
Movement in tenant incentives and contracted rent uplift balances
(2)
-
-
(2)
(49)
1
-
(48)
Carrying value at the end of the period/year
9,373
330
91
9,794
9,073
334
94
9,501
Head lease liabilities
(65)
(64)
Valuation surplus on trading properties
87
83
Group property portfolio valuation
at the end of the period/year
9,816
9,520
Non-controlling interests
(314)
(310)
Group property portfolio valuation
at the end of the period/year attributable
to shareholders
9,502
9,210
The Group's total property portfolio was valued by external valuers on the basis of fair value, in accordance with the RICS valuation - Professional Standards 2014, ninth edition, published by The Royal Institute of Chartered Surveyors. The information provided to the valuers, and the assumptions and valuations models used by the valuers are reviewed by the property portfolio team, the Head of Offices, the Head of Retail and the Chief Financial Officer. The valuers meet with the external auditors and also present directly to the Audit Committee on a half yearly basis.
Property valuations are inherently subjective as they are made on the basis of significant unobservable inputs, including assumptions made by the valuer which may not prove to be accurate. For these reasons, and consistent with EPRA's guidance, we have classified the valuations of our property portfolio as Level 3 as defined by IFRS 13. There were no transfers between levels in the period. Inputs to the valuation, including equivalent yields, rental values and costs to complete, are 'unobservable' as defined by IFRS 13.
Additional property covenant information
Properties valued at 1,678m (year ended 31 March 2017: 1,882m) were subject to a security interest and other properties of non-recourse companies amounted to 1,226m (year ended 31 March 2017: 1,158), totalling 2,904m (year ended 31 March 2017: 3,040m).

8Joint ventures and funds
Summary movement for the period of the investments in joint ventures and fund
Joint ventures
m
Funds
m
Total
m
Equity
m
Loans
m
Total
m
At 1 April 2017
2,525
241
2,766
2,412
354
2,766
Additions
32
3
35
12
23
35
Disposals
(68)
-
(68)
(68)
-
(68)
Share of profit after taxation
70
3
73
73
-
73
Distributions and dividends:
- Capital
-
(3)
(3)
(3)
-
(3)
- Revenue
(39)
(6)
(45)
(45)
-
(45)
Hedging and exchange movements
5
1
6
6
-
6
At 30 September 2017
2,525
239
2,764
2,387
377
2,764
At 31 March 2017 the Group classified a joint venture as a held-for-sale asset of 540m, presented separately from the investment in joint ventures and funds on the consolidated balance sheet. On 25 May 2017 the transaction completed and consequently the held for sale asset was disposed of.
Additional investments in joint ventures and funds covenant information
At 30 September 2017 the investments in joint ventures included within the total investments in joint ventures and funds was 2,758m, being the 2,764m total investment shown above, less the net investment of 6m in PREF, a property fund in continental Europe (31 March 2017: 3,299m, being 2,766 shown above plus a joint venture held for sale of 540m less a 7m net investment in PREF).
Summary income statement for the period of the investments in joint ventures and funds
Six months ended
30 September 2017
Six months ended
30 September 2016 
m
100% 
m
BL Share 
m
100%
m
BL Share
Revenue1
250
125
280
141
Costs
(52)
(26)
(64)
(33)
198
99
216
108
Administrative expenses
(2)
(1)
(3)
(2)
Net financing costs
(68)
(34)
(75)
(38)
Underlying Profit before taxation
128
64
138
68
Valuation movement
52
26
(408)
(205)
Capital financing costs
(18)
(9)
(12)
(6)
(Loss) profit on disposal of investment properties, trading properties and investments
(16)
(8)
23
12
Profit (loss) on ordinary activities before taxation
146
73
(259)
(131)
Taxation
-
-
-
-
Profit (loss) on ordinary activities after taxation
146
73
(259)
(131)
Profit (loss) split between controlling and non-controlling interests
Attributable to non-controlling interests
-
(2)
Attributable to shareholders of the Company
73
(133)
1 Included within revenue for the period is a 29m (15m British Land share) payment received in June 2017 from the Royal Bank of Scotland in relation to their surrender of a lease at 135 Bishopsgate.

Operating cash flows of joint ventures and funds (Group share)
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Rental income received from tenants
100
96
Operating expenses paid to suppliers and employees
(12)
(10)
Cash generated from operations
88
86
Interest paid
(38)
(41)
Cash inflow from operating activities
50
45
Cash inflow from operating activities deployed as:
Surplus cash retained within joint ventures and funds
5
20
Revenue distributions per consolidated statement of cash flows
45
25
Revenue distributions split between controlling and non-controlling interests
Attributable to non-controlling interests
1
2
Attributable to shareholders of the Company
44
23
9Other investments
30 September 2017
m
31 March
2017
m
Investment held for trading
96
93
Loans, receivables and other
62
61
158
154
The investment held for trading comprises interests as a trust beneficiary. The trust's assets comprise freehold reversions in a pool of commercial properties, comprising Sainsbury's superstores. The interest was categorised as Level 3 in the fair value hierarchy, is subject to the same inputs as those disclosed in note 7, and its fair value was determined by the Directors, supported by an external valuation.
10Net debt
10.1 Fair value and book value of net debt
30 September 2017
31 March 2017
Fair value
m
Book value
m
Difference
m
Fair value
m
Book value
m
Difference
m
Debentures and unsecured bonds
1,942
1,837
105
1,682
1,590
92
Convertible bonds
338
338
-
737
737
-
Bank debt and other floating rate debt
705
697
8
963
954
9
Gross debt
2,985
2,872
113
3,382
3,281
101
Interest rate and currency derivative liabilities
131
131
-
144
144
-
Interest rate and currency derivative assets
(175)
(175)
-
(217)
(217)
-
Cash and short-term deposits
(119)
(119)
-
(114)
(114)
-
Net debt
2,822
2,709
113
3,195
3,094
101
Net debt attributable to non-controlling interests
(111)
(110)
(1)
(105)
(103)
(2)
Net debt attributable to shareholders of the Company
2,711
2,599
112
3,090
2,991
99
The fair values of debentures, unsecured bonds and the convertible bonds have been established by obtaining quoted market prices from brokers. The bank debt and other floating rate debt has been valued assuming it could be renegotiated at contracted margins. The derivatives have been valued by calculating the present value of expected future cash flows, using appropriate market discount rates, by an independent treasury advisor. Short-term debtors and creditors and other investments (see note 9) have been excluded from the disclosures on the basis that the fair value is equivalent to the book value.
10.2 Loan to value
Group loan to value (LTV)
30 September
2017
m
31 March
2017
m
Group loan to value (LTV)
20.1%
22.6%
Principal value of gross debt
2,711
3,069
Less debt attributable to non-controlling interests
(116)
(112)
Less cash and short-term deposits (balance sheet)
(119)
(114)
Plus cash attributable to non-controlling interests
6
9
Total net debt for LTV calculation
2,482
2,852
Group property portfolio valuation (note 7)
9,816
9,520
Investments in joint ventures and funds (note 8)
2,764
2,766
Joint venture held for sale (note 8)
-
540
Other investments (note 9)
158
154
Less property and investments attributable to non-controlling interests
(368)
(364)
Total assets for LTV calculation
12,370
12,616
Proportionally consolidated loan to value (LTV)
30 September
2017
m
31 March
2017
m
Proportionally consolidated loan to value (LTV)
26.9%
29.9%
Principal value of gross debt
4,133
4,649
Less attributable to non-controlling interests
(132)
(128)
Less cash and short-term deposits
(322)
(323)
Plus cash attributable to non-controlling interests
8
9
Less joint venture debt beneficially owned by Group
(3)
-
Total net debt for proportional LTV calculation
3,684
4,207
Group property portfolio valuation (note 7)
9,816
9,520
Share of property of joint ventures and funds
4,083
4,801
Other investments (note 9)
158
154
Less other investments attributable to joint ventures and funds
(3)
(3)
Less property attributable to non-controlling interests
(384)
(381)
Total assets for proportional LTV calculation
13,670
14,091
10.3 British Land Unsecured Financial Covenants
The two financial covenants applicable to the Group unsecured debt including convertible bonds are shown below:
30 September
2017
m
31 March
2017
m
Net Borrowings not to exceed 175% of Adjusted Capital and Reserves
25%
29%
Principal amount of gross debt
2,711
3,069
Less the relevant proportion of borrowings of the partly-owned subsidiary / non-controlling interests
(116)
(112)
Less cash and deposits (balance sheet)
(119)
(114)
Plus the relevant proportion of cash and deposits of the partly-owned subsidiary / non-controlling interests
6
9
Net Borrowings
2,482
2,852
Share capital and reserves (balance sheet)
9,632
9,476
EPRA deferred tax adjustment (EPRA Table A)
5
3
Trading property surpluses (EPRA Table A)
90
83
Exceptional refinancing charges (see below)
267
274
Fair value adjustments of financial instruments (EPRA Table A)
137
155
Less reserves attributable to non-controlling interests (balance sheet)
(254)
(255)
Adjusted Capital and Reserves
9,877
9,736
In calculating Adjusted Capital and Reserves for the purpose of the unsecured debt financial covenants, there is an adjustment of 267m (31 March 2017: 274m) to reflect the cumulative net amortised exceptional items relating to the refinancings in the years ended 31 March 2005, 2006 and 2007.
30 September
2017
m
31 March
2017
m
Net Unsecured Borrowings not to exceed 70% of Unencumbered Assets
19%
26%
Principal amount of gross debt
2,711
3,069
Less cash and deposits not subject to a security interest (being 109m less the relevant proportion of cash and deposits of the partly owned subsidiary of 4m)
(105)
(96)
Less principal amount of secured and non-recourse borrowings
(1,251)
(1,238)
Net Unsecured Borrowings
1,355
1,735
Properties (note 7)
9,816
9,520
Investments in joint ventures and funds (note 8)
2,764
2,766
Joint venture held for sale (note 8)
-
540
Other investments (note 9)
158
154
Less investments in joint ventures (note 8)
(2,758)
(3,299)
Less encumbered assets (note 7)
(2,904)
(3,040)
Unencumbered Assets
7,076
6,641
10.4 Convertible bonds
1.5% Convertible bond 2012 (redeemed in the current period)
On 10 September 2012 British Land (Jersey) Limited (the Issuer), a wholly-owned subsidiary of the Group, issued 400 million 1.5% guaranteed convertible bonds due 2017 at par. On 10 September 2017, the convertible bonds were redeemed at par.
0% Convertible bond 2015 (maturity 2020)
On 9 June 2015 British Land (White) 2015 Limited (the 2015 Issuer), a wholly owned subsidiary of the Group, issued 350 million zero coupon guaranteed convertible bonds due 2020 (the 2015 bonds) at par. The 2015 Issuer is fully guaranteed by the Company in respect of the 2015 bonds.
Subject to their terms, the 2015 bonds are convertible into preference shares of the Issuer which are automatically transferred to the Company in exchange for ordinary shares in the Company or, at the Company's election, any combination of ordinary shares and cash. From 20 July 2015 up to and including 29 June 2018, a bondholder may exercise its conversion right if the share price has traded at a level exceeding 130% of the exchange price for a specified period. Thereafter, and up to but excluding the 7th dealing day before 9 June 2020 (the maturity date), a bondholder may convert at any time.
The initial exchange price was 1103.32 pence per ordinary share. The exchange price is adjusted based on certain events, such as the Company paying dividends in any year above a threshold amount in pence-per-ordinary-share. As at 30 September 2017 the exchange price was 1050.18 pence per ordinary share.
From 30 June 2018, the Company has the option to redeem the 2015 bonds at par if the Company's share price has traded above 130% of the exchange price for a specified period, or at any time once 85% by nominal value of the 2015 bonds have been converted, redeemed, or purchased and cancelled. The 2015 bonds will be redeemed at par on 9 June 2020 (the maturity date) if they have not already been converted, redeemed or purchased and cancelled.
10.5 Fair value hierarchy
The table below analyses financial instruments carried at fair value, by the valuation method. The different levels are defined as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
30 September 2017
31 March 2017
Level 1
m
Level 2
m
Level 3
m
Total
m
Level 1
m
Level 2
m
Level 3
m
Total
m
Interest rate and currency derivative assets
-
(175)
-
(175)
-
(217)
-
(217)
Other investments - available for sale
(14)
-
-
(14)
(14)
-
-
(14)
Other investments - held for trading
-
-
(96)
(96)
-
-
(93)
(93)
Assets
(14)
(175)
(96)
(285)
(14)
(217)
(93)
(324)
Interest rate and currency derivative liabilities
-
131
-
131
-
144
-
144
Convertible bonds
338
-
-
338
737
-
-
737
Liabilities
338
131
-
469
737
144
-
881
Total
324
(44)
(96)
184
723
(73)
(93)
557
There have been no transfers between levels in the period. A 3m valuation gain in relation to the investment held for trading has been recorded in the six months ended 30 September 2017 (30 September 2016: 8m valuation loss). Further disclosures in relation to the valuation of the investment held for trading are included within note 9.
11Dividend
The 2018 second quarter dividend of 7.52 pence per share is payable on 9 February 2018 to shareholders on the register at close of business on 5 January 2018.
The second interim dividend will be a Property Income Distribution ('PID') and no SCRIP alternative will be offered. PID dividends are paid, as required by REIT legislation, after deduction of withholding tax at the basic rate (currently 20%), where appropriate. Certain classes of shareholders may be able to elect to receive dividends gross. Please refer to our website (www.britishland.com) for details.
The 2018 first quarter dividend of 7.52 pence per share, totalling 77m was paid on 10 November 2017. The whole of the first quarter dividend was a PID and no scrip alternative was offered. 66m was paid to shareholders, and 11m of withholding tax was retained.
The Consolidated Statement of Changes in Equity shows total dividends in the six months to 30 September 2017 of 150m, 75m being the third quarter 2017 dividend of 7.30 pence per share paid on 5 May 2017, and the fourth quarter 2017 dividend of 7.30 pence per share, paid on 4 August, totalling 75m. No scrip alternatives were offered for the third or fourth quarters and the fourth quarter dividend was PID.
12Segment information

Operating segments
The Group allocates resources to investment and asset management according to the sectors it expects to perform over the medium term. Its three principal sectors are Offices, Retail and Canada Water. The Office sector includes residential, as this is often incorporated into Office schemes, and Retail includes leisure, for a similar rationale.
The relevant gross rental income, net rental income, operating result and property assets, being the measures of segment revenue, segment result and segment assets used by the management of the business, are set out below. Management reviews the performance of the business principally on a proportionally consolidated basis, which includes the Group's share of joint ventures and funds on a line-by-line basis and excludes non-controlling interests in the Group's subsidiaries. The chief operating decision maker for the purpose of segment information is the Executive Committee.
Gross rental income is derived from the rental of buildings. Operating result is the net of net rental income, fee income and administrative expenses. No customer exceeded 10% of the Group's revenues in either period.
Segment result
Six months ended 30 September
Offices
Retail
Canada Water
Other/unallocated
Total
2017
m
2016
m
2017
m
2016
m
2017
m
2016
m
2017
m
2016
m
2017
m
2016
m
Gross rental income
British Land Group
68
70
140
142
4
5
-
-
212
217
Share of joint ventures and funds
60
60
44
50
-
-
-
-
104
110
Total
128
130
184
192
4
5
-
-
316
327
Net rental income
British Land Group
62
67
133
136
4
4
-
-
199
207
Share of joint ventures and funds
57
58
41
47
-
-
-
-
98
105
Total
119
125
174
183
4
4
-
-
297
312
Operating result
British Land Group
61
66
129
129
2
3
(23)
(26)
169
172
Share of joint ventures and funds
56
56
39
49
-
-
-
-
95
105
Total
117
122
168
178
2
3
(23)
(26)
264
277
Reconciliation to Underlying Profit before taxation
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Operating result
264
277
Net financing costs
(66)
(78)
Underlying Profit
198
199
Reconciliation to profit on ordinary activities before taxation
Underlying Profit
198
199
Capital and other
34
(411)
Underlying Profit attributable
to non-controlling interests
6
7
Total profit (loss) on ordinary activities before taxation
238
(205)
Of the gross rental income above, nil (six months ended 30 September 2016: nil) was derived from outside the UK.
Segment assets
Offices
Retail
Canada Water
Total
30 September 2017
m
31 March 2017
m
30 September 2017
m
31 March 2017
m
30 September 2017
m
31 March 2017
m
30 September 2017
m
31 March 2017
m
Property assets
British Land Group
4,366
4,223
4,866
4,716
270
271
9,502
9,210
Share of funds and joint ventures
2,287
2,792
1,726
1,938
-
-
4,013
4,730
Total
6,653
7,015
6,592
6,654
270
271
13,515
13,940
Reconciliation to net assets
British Land Group
30 September 2017
m
31 March 2017
m
Property assets
13,515
13,940
Other non-current assets
162
156
Non-current assets
13,677
14,096
Other net current liabilities
(340)
(364)
Adjusted net debt
(3,691)
(4,223)
Other non-current liabilities
-
(11)
EPRA net assets (undiluted)
9,646
9,498
Non-controlling interests
254
255
EPRA adjustments
(268)
(277)
Net assets
9,632
9,476
13Related party transactions
There have been no material changes in the related party transactions described in the last annual report.
14Contingent liabilities
The Group, joint ventures and funds have contingent liabilities in respect of legal claims, guarantees and warranties arising in the ordinary course of business. It is not anticipated that any material liabilities will arise from contingent liabilities.
15Share capital and reserves
m
Ordinary shares
of 25p each
Issued, called and fully paid
At 1 April 2017
260
1,041,035,058
Issues
-
189,904
Repurchased and cancelled
(3)
(10,671,074)
At 30 September 2017
257
1,030,553,888
At 30 September 2017, of the issued 25p ordinary shares, 8,003 shares were held in the ESOP trust (31 March 2017: 7,783), 11,266,245 shares were held as treasury shares (31 March 2017: 11,266,245) and 1,019,279,640 shares were in free issue (31 March 2017: 1,029,761,030). No treasury shares were acquired by the ESOP trust during the year. All issued shares are fully paid.
In the six months ended 30 September 2017, the Company repurchased 10,724,362 ordinary shares, of which 10,671,074 were cancelled. The weighted average share price of repurchases was 607 pence. During the period from 1 October 2017 to 15 November 2017, a further 15,114,663 shares were repurchased, of which 12,842,709were cancelled. The weighted average share price of these repurchases was 599 pence.

SUPPLEMENTARY DISCLOSURES
UNAUDITED
Table A: Summary income statement and balance sheet
Summary income statement based on proportional consolidation for the six months ended 30September 2017
The following pro forma information is unaudited and does not form part of the consolidated primary statements or the notes thereto. It presents the results of the Group, with its share of the results of joint ventures and funds included on a line by line basis and excluding non-controlling interests.
Six months ended 30 September 2017
Six months ended 30 September 2016
Group
m
Joint ventures and funds
m
Less non-controlling interests
m
Proportionally consolidated
m
Group
m
Joint ventures and funds
m
Less non-controlling interests
m
Proportionally consolidated
m
Gross rental income
222
103
(9)
316
224
113
(10)
327
Property operating expenses
(15)
(4)
-
(19)
(10)
(5)
-
(15)
Net rental income
207
99
(9)
297
214
108
(10)
312
Administrative expenses
(40)
(1)
-
(41)
(42)
(2)
1
(43)
Net fees and other income
7
-
1
8
7
-
1
8
Ungeared Income Return
174
98
(8)
264
179
106
(8)
277
Net financing costs
(34)
(34)
2
(66)
(41)
(38)
1
(78)
Underlying Profit 
140
64
(6)
198
138
68
(7)
199
Underlying taxation
-
-
-
-
-
-
-
-
Underlying Profit after taxation
140
64
(6)
198
138
68
(7)
199
Valuation movement
167
(462)
Other capital and taxation (net)1
100
(411)
Capital and other
267
(873)
Total return
465
(674)
1 Includes other comprehensive income, movement in dilution of share options and the movement in items excluded for EPRA NAV.
Summary balance sheet based on proportional consolidation as at 30 September 2017
The following pro forma information is unaudited and does not form part of the consolidated primary statements or the notes thereto. It presents the results of the Group, with its share of the results of joint ventures and funds included on a line-by-line basis and excluding non-controlling interests.
Group
m
Share of joint ventures
& funds
m
Less non-controlling interests
m
Share
options
m
Deferred
tax
m
Mark-to-market on derivatives and related debt adjustments
m
Head
leases
m
Valuation surplus on trading properties
m
EPRA Net assets 
30 September 2017
m
EPRA Net assets
31
March
2017
m
Retail properties
5,218
1,804
(384)
-
-
-
(46)
-
6,592
6,654
Office properties
4,291
2,287
-
-
-
-
(15)
90
6,653
7,015
Canada Water properties
285
-
-
-
-
-
(15)
-
270
271
Total properties
9,794
4,091
(384)
-
-
-
(76)
90
13,515
13,940
Investments in joint ventures and funds
2,764
(2,764)
-
-
-
-
-
-
-
-
Other investments
158
(2)
-
-
-
-
-
-
156
151
Other net (liabilities) assets
(375)
(81)
5
36
5
-
76
-
(334)
(370)
Net debt
(2,709)
(1,244)
125
-
-
137
-
-
(3,691)
(4,223)
Net assets
9,632
-
(254)
36
5
137
-
90
9,646
9,498
EPRA NAV per share (note 2)
939p
915p
30 September 2017
31 March 2017
m
Pence per share
m
Pence per share
Opening EPRA NAV
9,498
915
10,074
919
Income return
198
19
390
36
Capital return
100
20
(670)
(13)
Dividend Paid
(150)
(15)
(296)
(27)
Closing EPRA NAV
9,646
939
9,498
915
Table B: EPRA Performance measures
EPRA Performance measures summary table
Six months ended
30 September 2017
Six months ended
30 September 2016
m
Pence per share
m
Pence per share
EPRA Earnings
- basic
198
19.3
199
19.3
- diluted
198
19.2
199
19.3
EPRA Net Initial Yield
4.3%
4.3%
EPRA 'topped-up' Net Initial Yield
4.6%
4.7%
EPRA Vacancy Rate
2.9%
2.7%
30 September 2017
31 March 2017
Net assets m
Net asset
value per share pence
Net assets m
Net asset
value per share pence
EPRA NAV
9,646
939
9,498
915
EPRA NNNAV
9,117
888
8,938
861
Calculation and reconciliation of EPRA/IFRS earnings and EPRA/IFRS earnings per share
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Profit (loss) attributable to the shareholders of the Company
239
(195)
Exclude:
Group - taxation
(7)
(1)
Group - valuation movement
(141)
257
Group - profit on disposal of investment properties and investments
(20)
(27)
Group - profit on disposal of trading properties
(8)
(3)
Joint ventures and funds - valuation movement (including result on disposals)
(18)
193
Joint ventures and funds - capital financing costs
9
6
Changes in fair value of financial instruments and associated close-out costs
144
(15)
Non-controlling interests in respect of the above
-
(16)
EPRA earnings - basic
198
199
Dilutive effect of 1.5% convertible bond
-
-
EPRA earnings - diluted
198
199
Profit (loss) attributable to the shareholders of the Company
239
(195)
Dilutive effect of 1.5% convertible bond
-
(26)
IFRS earnings - diluted
239
(221)
Six months ended 30 September 2017
Number
million
Six months ended 30 September 2016
Number
million
Weighted average number of shares
1,039
1,040
Adjustment for Treasury shares
(11)
(11)
IFRS/EPRA weighted average number of shares (basic)
1,028
1,029
Dilutive effect of share options
1
1
Dilutive effect of ESOP shares
2
3
Dilutive effect of 1.5% convertible bond
-
58
IFRS weighted average number of shares (diluted)
1,031
1,091
Remove dilutive effect of 1.5% convertible bond
-
(58)
EPRA weighted average number of shares (diluted)
1,031
1,033
Net assets per share
30 September 2017
31 March 2017
m
Pence
per share
m
Pence
per share
Balance sheet net assets
9,632
9,476
Deferred tax arising on revaluation movements
5
3
Mark-to-market on derivatives and related debt adjustments
137
155
Dilution effect of share options
36
36
Surplus on trading properties
90
83
Less non-controlling interests
(254)
(255)
EPRA NAV
9,646
939
9,498
915
Deferred tax arising on revaluation movements
(23)
(19)
Mark-to-market on derivatives and related debt adjustments
(137)
(155)
Mark-to-market on debt
(369)
(386)
EPRA NNNAV 
9,117
888
8,938
861
EPRA NNNAV is the EPRA NAV adjusted to reflect the fair value of the debt and derivatives and to include the deferred taxation on revaluations and derivatives.
30 September 2017
Number
million
31 March
2017
Number
million
Number of shares at period/year end
1,030
1,040
Adjustment for treasury shares
(11)
(11)
IFRS/EPRA Number of shares (basic)
1,019
1,029
Dilutive effect of share options
2
3
Dilutive effect of ESOP shares
6
6
Dilutive effect of 1.5% convertible bond
-
58
IFRS number of shares (diluted)
1,027
1,098
Remove dilutive effect of 1.5% convertible bond
-
(58)
EPRA number of shares (diluted)
1,027
1,038
EPRA Net Initial Yield and 'topped-up' Net Initial Yield
30 September 2017
m
30 September
2016
m
Investment property - wholly-owned
9,502
9,321
Investment property - share of joint ventures and funds
4,013
4,598
Less developments, residential and land
(1,242)
(951)
Completed property portfolio
12,273
12,968
Allowance for estimated purchasers' costs
813
914
Gross up completed property portfolio valuation (A)
13,086
13,882
Annualised cash passing rental income
581
610
Property outgoings
(13)
(9)
Annualised net rents (B)
568
601
Rent expiration of rent-free periods and fixed uplifts1
32
50
'Topped-up' net annualised rent (C)
600
651
EPRA Net Initial Yield (B/A)
4.3%
4.3%
EPRA 'topped-up' Net Initial Yield (C/A)
4.6%
4.7%
Including fixed/minimum uplifts received in lieu of rental growth
11
16
Total 'topped-up' net rents (D)
611
667
Overall 'topped-up' Net Initial Yield (D/A)
4.7%
4.8%
'Topped-up' net annualised rent
600
651
ERV vacant space
19
19
Reversions
32
31
Total ERV (E)
651
701
Net Reversionary Yield (E/A)
5.0%
5.0%
1 The weighted average period over which rent-free periods expire is 1 year (30 September 2016: 1 year).
EPRA Net Initial Yield (NIY) basis of calculation
EPRA NIY is calculated as the annualised net rent (on a cash flow basis), divided by the gross value of the completed property portfolio. The valuation of our completed property portfolio is determined by our external valuers as at 30 September 2017, plus an allowance for estimated purchaser's costs. Estimated purchaser's costs are determined by the relevant stamp duty liability, plus an estimate by our valuers of agent and legal fees on notional acquisition. The net rent deduction allowed for property outgoings is based on our valuers' assumptions on future recurring non-recoverable revenue expenditure.
In calculating the EPRA 'topped-up' NIY, the annualised net rent is increased by the total contracted rent from expiry of rent-free periods and future contracted rental uplifts where defined as not in lieu of growth. Overall 'topped-up' NIY is calculated by adding any other contracted future uplift to the 'topped-up' net annualised rent.
The net reversionary yield is calculated by dividing the total estimated rental value (ERV) for the completed property portfolio, as determined by our external valuers, by the gross completed property portfolio valuation.
The EPRA vacancy rate is calculated as the ERV of the un-rented, lettable space as a proportion of the total rental value of the completed property portfolio.
EPRA Vacancy Rate
30 September 2017
m
30 September
2016
m
Annualised potential rental value of vacant premises
19
19
Annualised potential rental value for the completed property portfolio
662
710
EPRA Vacancy Rate
2.9%
2.7%
EPRA Cost Ratios
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Property operating expenses
15
10
Administrative expenses
40
41
Share of joint ventures and funds expenses
5
7
Less:
Performance & management fees (from joint ventures & funds)
(3)
(4)
Other fees and commission
(5)
(4)
Ground rent costs
(1)
(1)
EPRA Costs (including direct vacancy costs) (A)
51
49
Direct vacancy costs
(10)
(6)
EPRA Costs (excluding direct vacancy costs) (B)
41
43
Gross Rental Income less ground rent costs
212
215
Share of joint ventures and funds (Gross Rental Income less ground rent costs)
103
111
Total Gross Rental Income (C)
315
326
EPRA Cost Ratio (including direct vacancy costs) (A/C)
16.2%
15.0%
EPRA Cost Ratio (excluding direct vacancy costs) (B/C)
13.0%
13.2%
Overhead and operating expenses capitalised (including share of joint ventures and funds)
3
2
In the current and prior periods employee costs in relation to staff time on development projects are capitalised into the base cost of relevant development assets.
Table C: Gross rental income
Six months ended 30 September 2017
m
Six months ended 30 September 2016
m
Rent receivable
304
317
Spreading of tenant incentives and guaranteed rent increases
(8)
8
Surrender premia
20
2
Gross rental income
316
327
The current and prior period information is presented on a proportionally consolidated basis, excluding non-controlling interests.
Table D: Property related capital expenditure
Six months ended 30 September 2017
Year ended 31 March 2017
Group
Joint
ventures
and funds
Total
Group
Joint
ventures
and funds
Total
Acquisitions
141
-
141
88
-
88
Development
50
16
66
131
14
145
Like-for-like portfolio
34
15
49
67
47
114
Other
8
2
10
20
2
22
Total property related capex
233
33
266
306
63
369
The above is presented on a proportionally consolidated basis, excluding non-controlling interests and business combinations. The 'Other' category contains amounts owing to tenant incentives of 2m (31 March 2017: 7m), letting fees of 2m (31 March 2017: 3), capitalised staff costs of 3m (31 March 2017: 5m) and capitalised interest of 3m (31 March 2017: 7m).

This information is provided by RNS
The company news service from the London Stock Exchange
  END
IR LFFSILRLELID