Ballymore's UK arm has £115m loss but rebound is predicted
THE UK arm of Ballymore Properties suffered losses of more than £115m (€135m) in the year to March 2009 but will post "considerably improved" results for the financial year just gone, founder Sean Mulryan said at the weekend.
The UK loss was revealed in accounts just filed for Ballymore Properties Holdings (BPH) and came as the company suffered a 42pc fall in turnover and booked £99.6m of impairment charges on its property portfolio.
The accounts also show BPH closed its 2009 financial year reliant on its financial institutions to "continue to renew terms, extend facilities and waive covenant as deemed appropriate" on the group's £1.7bn debt pile.
Responding to the figures, Mr Mulryan stressed that the accounts for BPH "cover the period at the height of the global financial crisis". Ballymore's UK and Irish divisions will both show a "considerably improved trading position" for the year ending March 2010, he added.
Ballymore's UK revenue fell from £260m in the 2008 financial year to £152m in the year to March 2009 as the company suffered from a "significant shift in rental yields" on some properties as well as a generally "difficult" operating environment.
Mr Mulryan said figures from the UK National Monthly House Price Index showed average UK prices were now 11.4pc up on February 2009, while prices in London rose 15.7pc.
"We're in a strong position to capitalise on these trends -- our primary focus is on London -- a market that's forecast to continue to recover," Mr Mulryan added.
Ballymore sold £36m of apartments in London in April, as its flagship Pan Penninsula project nears completion and pre-sales begin on a new Wapping development.
Mr Mulryan also stressed that 2009's results were dragged down by £100m of impairment charges as BPH wrote down its investment properties by £36.3m and its stocks by £63.3m. "With an improving market, it is expected that these impairments will reverse," Mr Mulryan said.
BPH was left with shareholders' deficit of more than £55m after 2009's losses, but the filings point to "significant unrecognised development value inherent in its stock" to be realised once the company's sites are developed and sold.
The filings also include significant commentary on BPH's funding position. The group closed the 2009 year with almost £1.7bn in debt falling due within the next 12 months, and was "reliant on its financial institutions to continue to renew terms, extend facilities and waive covenants as deemed appropriate".
BPH successfully renegotiated £284m of its debt between March 2009 and the sign-off of the accounts toward the end of that year.
"Since the accounts were approved, Ballymore has renewed or is in the final stage of agreeing renegotiated debt facilities," Mr Mulryan said.
The latest filings also show that Mr Mulyran's remuneration from BPH fell by £1.24m last year to £360,000.