FOR IMMEDIATE RELEASE29 August 2014 LONDON & ASSOCIATED PROPERTIES PLC: HALF YEARLY RESULTS TO 30 JUNE 2014London & Associated Properties PLC (`LAP' or the `Company'), is a fully listedretail property investor and asset manager. HIGHLIGHTS * Completion of new £45 million debt financing * Substantial reduction in cost of debt - down from 7.58% to the current 5.48% * Long-dated swaps terminated * Group's future underpinned by strength of income with weighted average unexpired lease term of 8.2 years * Portfolio performing well: * Sheffield - vacant space under offer with new leases agreed at £80 Zone A * Brixton - demand for space driving income; plans for expansion under consideration * LAMS trading strongly and looking to expand through further joint ventures"We are delighted that LAP is now on a secure footing with both long termfinancing in place and a very strong income base. We have a new and positivebanking relationship and trading conditions are improving. We therefore look tothe future with confidence." Sir Michael Heller, Chairman and John Heller,Chief Executive -more-Contact:London & Associated Properties PLC Tel: 020 7415 5000John Heller, Chief Executive orRobert Corry, Finance DirectorBaron Phillips Associates Tel: 07767 444193Baron PhillipsHALF YEAR REVIEWWe are pleased to report on a successful first half of the year. We haveachieved a significant strengthening of the LAP Balance Sheet, following therefinancing of our short term bank debt and the termination of our long datedswaps. This has resulted in a substantial reduction in LAP's average cost ofdebt from 7.58% at 31 December 2013 to 5.48% today.We have put in place a five year £45 million non-recourse financing, providedby Santander (as senior lender) and Europa Capital Mezzanine Ltd (as mezzaninelender), replacing the short term Royal Bank of Scotland (RBS) facilities. Thesenior facility is fully hedged with 50% being swapped at a rate of 2.25% andthe remaining 50% covered by a cap at the same level. This means that currentlythe debt has a blended interest rate of 4.79%.We actually completed our new financing on 1 July 2014, the day after the halfyear accounting period ended. This has had a significant effect on the GroupBalance Sheet and to enable shareholders to understand the impact, we haveincluded a pro-forma Balance Sheet showing the adjusted position at 1 July. Thekey changes are that the Group now has a positive net current assets positionand an extra £3.5 million of cash.LAP's long term debt now has three components: the new £45 million financingexpiring in July 2019; and two debentures, one for £10 million, expiring inAugust 2022 and one for £5 million of which £1 million is repayable in August2016, £1 million in August 2017 and the balance of £3 million in August 2018.We believe this places the Group in a very secure position for the medium termas we look to acquire new investments either on our own or in joint ventures.Our half year results have been affected by two exceptional factors. First, weincurred significant expenses in re-financing the RBS facilities; and second,we spent £25.3 million on the termination of the long dated swaps which we hadused to hedge our loans from RBS and Lloyds Bank. We had provided for thisanticipated cost in our 2013 year-end figures, based on the mark-to-marketvalue quoted by the banks at that date. The reduction in the referenceinterest rates post the year-end meant that the provision we had made was lowerthan the mark-to-market settlement at the time the swaps wereactually terminated. Consequently a further £1.1 million has been chargedagainst income in the period.We are confident that LAP will trade strongly now that our legacy financingissues have been removed. The Group's future is underpinned by the strength ofour income, with our weighted average unexpired lease term (WAULT) continuingto be a resilient 8.2 years. Further, if this is adjusted to exclude tenantswhose leases have expired but who continue to trade, WAULT rises to 9.0 years.Group income is also enhanced by the increasingly successful performance ofLondon & Associated Management Services Ltd (LAMS), our asset managementbusiness.We now own £87.5 million of retail property directly, although we manageand have financial interests in some £240 million of property in total,including joint ventures and the portfolio of Bisichi Mining PLC,our associated company.At Orchard Square, Sheffield, we are pleased to report that we have agreedterms with River Island at £495,000 per annum on a new 10 year lease with abreak clause (with penalty) at the fifth year. The other large unit whichfronts on to Fargate had previously been let to USC (formerly Republic) butbecame vacant earlier this year as that retailer reduced its number of unitssignificantly. We have received a number of offers on this unit. We areconfident that it will be re-let and income producing in the near future. We will update shareholders in due course.In addition, we have recently placed under offer two units inside the centre toexciting and established retailers at £80 Zone A, while both Waterstones andClarks have renewed their leases - also at £80 Zone A. Not only have these newleases established a rental tone in the Orchard Centre but they have alsostrengthened the long term income now being generated.Our two markets in Brixton continue to go from strength to strength. Incomegrowth is being driven by the extended waiting list, which now comprises over200 traders. The local authority has commenced consultation on a new frameworkfor enhancing Brixton as a town centre, and, as our markets are considered tobe the principal focal point, we would consider investing to expand them.Indeed, together with Groupe Geraud, we have held initialdiscussions with adjacent land owners.The remainder of our directly held portfolio is trading satisfactorily andvoids remain at a low level. Demand from retailers has continued to showencouraging signs, and we are confident that we will continue to trade in linewith expectations.Our joint ventures, which are managed by LAMS, are trading well.The larger of the two is that with Oaktree Capital Management, which owns andoperates three substantial shopping centres: the Vancouver Quarter in KingsLynn; the Rushes in Loughborough; and the Kingsgate centre in Dunfermline,Scotland. We are pleased to report that in the first half of the year we haveenhanced the income of all three centres, with additional annual lettings ofover £700,000 in total. We are also considering a number of asset managementopportunities within these centres and will report more fully when these havebeen progressed further.The other joint venture is in Langney, near Eastbourne, with Schroders'Columbus Capital Management Limited. As we reported previously, the roofcollapsed in December 2012 in heavy rain and consequently much of the last yearhas been spent dealing with the repercussions of that. I am pleased to reportthat these issues are now behind us and the centre is trading well. Our plansto extend this centre are well progressed and planning consent has beengranted. We have placed the anchor store under offer and are looking toagree terms for pre-lets on a number of other units.We continue to look to expand this aspect of LAP's business. LAMS has beenasked on several occasions to join bidding teams to acquire furtherinvestments that we will asset manage in addition to investing equity in. Ihope to be able to announce further success in this area in the future.Last month we announced that Robert Corry, LAP's Finance Director, had decidedto retire after more than 22 years with the Company. He has played an integralrole in the management team over that time and in particular he helped tosecure our new finance facilities. We would like to thank him for hiscontribution to LAP's success and wish him well in his retirement.We are delighted that LAP is now on a secure footing with both long termfinancing in place and a very strong income base. We have a new and positivebanking relationship and trading conditions are improving. We therefore look tothe future with confidence.Sir Michael Heller John HellerChairman Chief Executive28 August 2014Consolidated income statementfor the six months ended 30 June 2014 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited) Notes £'000 £'000 £'000Gross property income 3,745 3,761 8,229Net revenue from property 1 1,023 1,701 2,979Listed investments held for trading 1 1 1 2Results before finance costs and 1,024 1,702 2,981valuation movementsFinance income 2 31 28 59Finance expenses 2 (2,389) (2,582) (5,616)Interest derivatives break costs 2 (1,117) - -Results before valuation movements (2,451) (852) (2,576)Non-cash changes in valuation of assetsand liabilitiesNet decrease on revaluation of investment - - (488)propertiesNet increase in value of investments held 1 3 3for tradingShare of profit/(loss) of joint ventures 289 (10) 99after taxShare of (loss)/profit of associate after (95) 447 151taxAdjustment to interest rate derivatives 6 - 4,124 4,419Results including revaluation and other (2,256) 3,712 1,608movementsAttributable to discontinued operations* 69 6,516 (461)(Loss)/profit for the period before (2,187) 10,228 1,147taxationIncome tax 3 589 (1,932) 2,326(Loss)/profit for the period attributable (1,598) 8,296 3,473to the owners of the parentBasic earnings per share 4 (1.89)p 9.85p 4.12pDiluted earnings per share 4 (1.89)p 9.85p 4.12p*The results previously reported in the six months ended 30 June 2013 have beenreclassified to reflect discontinued operations.Consolidated statement of comprehensive incomefor the six months ended 30 June 2014 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited) £'000 £'000 £'000(Loss) / profit for the period (1,598) 8,296 3,473Other comprehensive income:Currency translation in associate (50) (136) (320)Other comprehensive income for the period net (50) (136) (320)of taxTotal comprehensive income for the period (1,648) 8,160 3,153attributable to owners of the parentConsolidated balance sheetat 30 June 2014 1 July 30 June 30 June 31 December 2014* 2014 2013 2013 (unaudited) (unaudited) (unaudited) (audited) £'000 Notes £'000 £'000 £'000 pro-formaNon-current assetsMarket value of properties 87,449 87,449 205,421 87,449attributable to GroupPresent value of head 4,593 4,593 28,655 4,597leasesProperty 92,042 5 92,042 234,076 92,046Plant and equipment 197 197 238 203Investments in joint 2,897 2,897 1,396 2,607venturesInvestments in associated 6,681 6,681 7,418 6,986companyHeld to maturity 2,200 2,200 1,939 2,200investmentsDeferred tax 6,249 6,249 1,392 5,651 110,266 110,266 246,459 109,693Current assetsAssets held for sale - - - 126,590Trade and other 4,184 4,184 4,763 3,356receivablesFinancial assets - 24 24 23 23investments held fortradingCash and cash equivalents 7,562 3,939 8,325 6,990 11,770 8,147 13,111 136,959Total assets 122,036 118,413 259,570 246,652Current liabilitiesLiabilities associated - - - (111,523)with assets held for saleTrade and other payables (10,714) (10,357) (12,745) (10,255)Financial liabilities - (359) (40,464) (52,609) (45,918)borrowings (11,073) (50,821) (65,354) (167,696)Non-current liabilitiesFinancial liabilities - (58,234) (14,863) (86,825) (15,056)borrowingsInterest rate derivatives - 6 - (24,044) (9,569)Present value of head (4,593) (4,593) (28,655) (4,597)leases on properties (62,827) (19,456) (139,524) (29,222)Total liabilities (73,900) (70,277) (204,878) (196,918)Net assets 48,136 48,136 54,692 49,734Equity attributable to theowners of the parentShare capital 8,554 8,554 8,554 8,554Share premium account 4,866 4,866 4,866 4,866Translation reserve in (708) (708) (474) (658)associateCapital redemption reserve 47 47 47 47Retained earnings 36,262 36,262 42,858 38,084(excluding treasuryshares)Treasury shares (885) (885) (1,159) (1,159)Retained earnings 35,377 35,377 41,699 36,925Total shareholders' equity 48,136 48,136 54,692 49,734Net assets per share 56.96p 7 56.96p 64.89p 59.00pDiluted net assets per 56.96p 7 56.96p 64.87p 59.00pshare*Balance Sheet amended as at 1 July to reflect the refinancing of the termloan.Consolidated statement of changes in shareholders' equityfor the six months ended 30 June 2014 Retained Retained Earnings Translation Capital Earnings ex: Share Share reserve in redemption Treasury treasury Total capital premium associate reserve Shares shares equity £'000 £'000 £'000 £'000 £'000 £'000 £'000Balance at 1 8,554 4,866 (338) 47 (1,421) 34,749 46,457January 2013Profit for the - - - - - 8,296 8,296periodOther comprehensiveincome:Currency - - (136) - - - (136)translation inassociateTotal other - - (136) - - - (136)comprehensiveincomeTotal comprehensive - - (136) - - 8,296 8,160incomeTransactions withowners:Equity share - - - - - 13 13options inassociateDisposal of own - - - - 62 - 62sharesLoss on disposal of - - - - 200 (200) -own sharesTransactions with - - - - 262 (187) 75ownersBalance at 30 June 8,554 4,866 (474) 47 (1,159) 42,858 54,6922013 (unaudited)Balance at 1 8,554 4,866 (338) 47 (1,421) 34,749 46,457January 2013Profit for the year - - - - - 3,473 3,473Other comprehensiveincome:Currency - - (320) - - - (320)translation inassociateTotal other - - (320) - - - (320)comprehensiveincomeTotal comprehensive - - (320) - - 3,473 3,153incomeTransactions withowners:Equity share - - - - - 62 62options inassociateDisposal of own - - - - 62 - 62sharesLoss on disposal of - - - - 200 (200) -own sharesTransactions with - - - - 262 (138) 124ownersBalance at 31 8,554 4,866 (658) 47 (1,159) 38,084 49,734December 2013(audited)Balance at 1 8,554 4,866 (658) 47 (1,159) 38,084 49,734January 2014Loss for the period - - - - - (1,598) (1,598)Other comprehensiveincome:Currency - - (50) - - - (50)translation inassociateTotal other - - (50) - - - (50)comprehensiveincomeTotal comprehensive - - (50) - - (1,598) (1,648)incomeTransactions withowners:Equity share - - - - - 16 16options inassociateAcquisition of own - - - - (88) - (88)sharesDisposal of own - - - - 228 - 228sharesLoss on disposal of - - - - 134 (134) -own sharesDividends paid - - - - - (106) (106)Transactions with - - - - 274 (224) 50ownersBalance at 30 June 8,554 4,866 (708) 47 (885) 36,262 48,1362014 (unaudited)All of the above are attributable to the owners of the parent.Consolidated cash flow statementfor the six months ended 30 June 2014 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited) £'000 £'000 £'000Operating activitiesNet revenue from property - continuing 1,023 1,701 2,979operationsNet revenue from property - discontinued 316 3,876 6,557operationsListed investments held for trading 1 1 2Depreciation 18 30 54Profit on disposal of non-current assets - (6) (21)(Increase) / decrease in receivables (378) (198) 792(Decrease) / increase in payables (1,499) 363 471Cash generated from operations (519) 5,767 10,834Income tax paid - - -Cash (outflow) / inflows from operating (519) 5,767 10,834activitiesInvesting activities(Investment)/repayment in shares and loan - (58) 409stock in joint venturesInvestment in shares held to maturity - - (2,200)Property acquisitions and improvements - (9) (34)Sale of properties - discontinued operations 102,663 - 9,310Purchase of office equipment and motor (13) (29) (33)vehiclesSale of office equipment and motor vehicles - 27 57Interest received - continuing operations 11 28 41Interest received - discontinued operations 7 - -Dividends received from associate and joint 44 44 177venturesCash inflows from investing activities 102,712 3 7,727Financing activitiesPurchase of treasury shares (88) - -Sale of treasury shares 228 62 62Equity dividends paid (106) - -Interest paid - continuing operations (2,992) (2,568) (3,314)Interest paid - discontinued operations (623) (2,185) (5,990)Interest paid on obligation under finance (155) (109) (269)leases - continuing operationsInterest paid on obligation under finance (544) (750) (1,786)leases - discontinued operationsDebenture stock break costs paid - - - (545)discontinued operationsInterest rate derivative break costs - (10,686) - -continuing operationsInterest rate derivative break costs - (14,599) - -discontinued operationsShort term loan from joint ventures and - - 700related partiesRepayment of debenture stocks - discontinued - - (6,700)operations(Repayment) / drawdown of short term bank (4,089) - -loansRepayment of medium term bank loan - (127) (122) (247)continuing operationsRepayment of medium term bank loan - (70,000) - -discontinued operationsCash outflows from financing activities (103,781) (5,672) (18,089)Net (decrease) / increase in cash and cash (1,588) 98 472equivalentsCash and cash equivalents at beginning of 5,500 5,028 5,028periodCash and cash equivalents at end of period 3,912 5,126 5,500Cash and cash equivalentsFor the purpose of the cash flow statement, cash and cash equivalents comprisethe following balance sheet amounts: 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited) £'000 £'000 £'000Cash and cash equivalents 3,939 8,325 6,990Bank overdraft (27) (3,199) (1,490)Cash and cash equivalents at end of period 3,912 5,126 5,500Notes to the half year reportfor the six months ended 30 June 20141. Segmental analysis 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited) £'000 £'000 £'000Net property income 1,023 1,701 2,979Other income (listed investments) 1 1 22. Finance costs 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited) £'000 £'000 £'000Finance income 31 28 59Finance expenses:Interest on bank loans and overdrafts (928) (612) (1,659)Other loans (796) (764) (1,559)Interest on derivatives adjustment (510) (1,042) (2,111)Interest on obligations under finance (155) (164) (287)leases (2,389) (2,582) (5,616)Interest derivatives break costs (1,117) - -Total finance expenses (3,506) (2,582) (5,616)3. Income tax 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited) £'000 £'000 £'000Current tax (9) - -Deferred tax 598 (1,932) 2,326 589 (1,932) 2,326Notes to the half year report continued4. Earnings per share 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited)Group (loss)/profit after tax (£ (1,598) 8,296 3,473'000)Weighted average number of shares in 84,494 84,247 84,266issue for the period ('000)Basic earnings per share (1.89)p 9.85p 4.12pDiluted number of shares in issue 84,494 84,247 84,266('000)Fully diluted earnings per share (1.89)p 9.85p 4.12p5. PropertyProperties at 30 June 2014 are included at valuation as at 31 December 2013,plus additions in the period.During the six months ended 30 June 2013 the group had property additions of £nil (30 June 2013: £0.009 million,31 December 2013: £0.014 million).No properties were sold during the six months ended 30 June 2014 (carryingvalue of properties sold at 30 June 2013: £Nil, 31 December 2013: £9.475million).The £104.7 million cash for the sale of the Windsor Shopping Centre, thediscontinued assets, was received on 17 January 2014.6. Interest rate derivativesAll hedging instruments at the year-end were repaid by April 2014.7. Net assets per share 30 June 30 June 31 December 2014 2013 2013 (unaudited) (unaudited) (audited)Shares in issue ('000) 84,508 84,288 84,288Net assets per balance sheet (£'000) 48,136 54,692 49,734Basic net assets per share 56.96p 64.89p 59.00pShares in issue diluted by 84,528 84,358 84,288outstanding share options ('000)Net assets after issue of share 48,146 54,720 49,734options (£'000)Fully diluted net assets per share 56.96p 64.87p 59.00p8. Bank loansThe group repaid in May 2014 the balance of its secured £47 million revolvingcredit facility.This was replaced with a short term secured bank loan of £40.1 million.On 1 July 2014 the group repaid the £40.1 million loan and replaced with a newsecured £45 million five year term financing package.Taking account of the hedging of interest rates on the senior facilities andthe fixed interest rate on the mezzanine facilities this has a current blendedinterest rate of 4.79%.Following the sale of King Edward Court, Windsor in January 2014, the £70million term bank loan was repaid.Notes to the half year report continued9. Related party transactionsThe related parties and the nature of costs recharged are as disclosed in thegroup's annual financial statements for the year ended 31 December 2013.The group has management fees receivable of £68,750 (30 June 2013: £68,750, 31December 2013: £137,500) from Bisichi Mining PLC, an associated company.The group, during the period, was repaid £64,250 of the unsecured loan byLangney Shopping Centre Unit Trust (a joint venture).10. Capital and other commitmentsThe group has capital commitments of £Nil as at 30 June 2014 (30 June 2013: £Nil, 31 December 2013: £Nil).11. DividendsThere is no interim dividend payable for the period (30 June 2013: Nil).The final dividend in respect of 2013 of 0.125p per share, amounting to £106k,was paid on 4 July 2014. As the 2013 final dividends was approved by theshareholders at the Annual General Meeting held on 10 June 2014, it is includedas a liability in these interim financial statements.12. Risks and UncertaintiesThe group's principal risks and uncertainties are reported on page 15 in the2013 Annual Report. They have been reviewed by the Directors and remainunchanged for the current period.The largest area of estimation and uncertainty in the interim financialstatements is in respect of the valuation of investment properties (which arenot revalued at the half year) and the valuation of interest rate derivatives.13. Financial informationThe above financial information does not constitute statutory accounts withinthe meaning of section 434 of the Companies Act 2006. The figures for the yearended 31 December 2013 are based upon the latest statutory accounts, which havebeen delivered to the Registrar of Companies; the report of the auditor's onthose accounts was unqualified and did not contain a statement under Section498(2) or (3) of the Companies Act 2006.As required by the Disclosure and Transparency Rules of the UK's FinancialServices Authority, the interim financial statements have been prepared inaccordance with the International Financial Reporting Standards (IFRS) and inaccordance with both IAS 34 'Interim Financial Reporting' as adopted by theEuropean Union and the disclosure requirements of the Listing Rules.The half year results have not been audited or subject to review by thecompany's auditor.The annual financial statements of London & Associated Properties PLC areprepared in accordance with IFRS as adopted by the European Union. The sameaccounting policies are used for the six months ended 30 June 2014 as were usedfor the year ended 31 December 2013.The assessment of new standards, amendments and interpretations issued but noteffective, is that these are not anticipated to have a material impact on thefinancial statements.There is no material seasonal impact on the group's financial performance.Taxes on income in the interim periods are accrued using tax rates expected tobe applicable to total annual earnings.The interim financial statements have been prepared on the going concern basisas the Directors are satisfied the group has adequate resources to continue inoperational existence for the foreseeable future.14. Board approvalThe half year results were approved by the Board of London & AssociatedProperties PLC on 28 August 2014.Directors' responsibility statementThe Directors confirm that to the best of their knowledge:(a) the condensed set of financial statements have been prepared in accordancewith applicable accounting standards and IAS 34 Interim Financial Reporting asadopted by the EU;(b) the interim management report includes a fair review of the informationrequired by:(1) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication ofimportant events that have occurred during the first six months of thefinancial year and their impact on the condensed set of financial statements ;and a description of the principal risks and uncertainties for the remainingsix months of the year; and(2) DTR 4.2.8R of the Disclosure and Transparency Rules, being related partytransactions that have taken place in the first six months of the currentfinancial year and that have materially affected the financial position orperformance of the entity during that period; and any changes in the relatedparty transactions described in the last annual report that could do so.Signed on behalf of the Board on 28 August 2014Sir Michael Heller Robert CorryDirector DirectorDirectors and advisorsDirectorsExecutive directors* Sir Michael Heller MA FCA (Chairman)John A Heller LLB MBA (Chief Executive)Robert J Corry BA FCA (Finance Director)Non-executive directors† Howard D Goldring BSC (ECON) ACA#†Clive A Parritt FCA CF FIIARobin Priest* Member of the nomination committee# Senior independent director† Member of the audit, remuneration and nominationcommittees.Secretary & registered officeHeather A Curtis ACIS24 Bruton Place,London W1J 6NERegistrars & transfer officeCapita Asset ServicesShareholder ServicesThe Registry, 34 Beckenham RoadBeckenham, Kent BR3 4TUTelephone 0871 664 0300(Calls cost 10p per minute + networkextras, lines are open Mon-Fri 9.00am to5.30pm)or +44 208 639 3399 for overseas callersWebsite: www.capitaregistrars.comE-mail: shareholderenquiries@capita.co.ukCompany registration number341829 (England and Wales)Websitewww.lap.co.ukE-mailadmin@lap.co.uk