Member Article

Pretax profits dip at Grainger ahead of new era

Grainger plc has revealed a decline in pretax profit to £50m, down from £81.1m last year, although this was impacted by the £18.2m loss on its re-acquisition of ERIL combined with a £7m adverse movement on derivatives.

The Newcastle-based property management firm today announced its preliminary results for the year ended 30 September 2015, as well as revealing its decision to sell its German assets - as broken by Bdaily this morning.

The firm’s announcement this morning to sell its German interest will generate a non-recurring pre-tax profit of £11m. This is particularly pleasing for Andrew Cunningham, chief executive of Grainger, who is set to retire shortly.

The company highlighted strong value growth, with gross net asset value (NAV) per share up 9.7% or 28p, to 319p. Moreover, it continued to perform well in trading of reversionary assets on vacancy, with profits from these sales totalling £68.4m, a rise of £7.8m on last year.

A New Era

Andrew Cunningham, chief executive of Grainger, said: “Over the past year, the business has performed well with net asset value rising by nearly 10 per cent.

“I am pleased that we have made progress with the proposed sale of our German assets and have agreed with our JV partner, Heitman, to bring forward the exit from our German JV.

“We have also continued to successfully build our private rented sector business, supported by our reversionary assets, which are continuing to deliver good value for the business, providing substantial and predictable cashflows for our investment in higher yielding PRS assets.”

On 28 January 2016, Helen Gordon, Grainger’s new CEO, will provide an update on the Board’s strategy. Alongside Helen, Vanessa Simms also joins the firm as Finance Director.

Andrew added: “As I approach my retirement, I am pleased to be leaving Grainger in a strong position to move forward and build on its leadership in the UK residential market. With an exciting future ahead, I wish Helen and Vanessa every success in their new roles.”