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RNS Number : 6166E

British Land Co PLC

14 May 2013

Consolidated Income Statement
for the year ended 31 March 2013
					2013					2012

					Underlying		Capital			Underlying		Capital
					pre-tax*	and other		Total		pre-tax*	and other		Total
				Note	£m		£m	£m		£m		£m	£m



Gross rental and related income				3	329		-	329		332		-	332

Net rental and related income				3	281		-	281		286		-	286

Fees and other income				4	15		-	15		16		-	16

Joint ventures and funds (see also below)					130		(63)	67		113		69	182

Administrative expenses					(72)		-	(72)		(69)		-	(69)

Net valuation movement (includes result on disposals)				5	-		88	88		-		143	143

Financing costs

	- financing income			6	21		2	23		24		2	26
	- financing charges			6	(101)		(41)	(142)		(101)		(4)	(105)

					(80)		(39)	(119)		(77)		(2)	(79)


Profit (loss) on ordinary activities before taxation					274		(14)	260		269		210	479

Taxation

	- current tax income (expense)			7			8	8				(2)	(2)
	- deferred tax income			7			16	16				3	3

							24	24				1	1

Profit for the year after taxation attributable to shareholders of the Company								284					480


Earnings per share:		-	basic	2				31.7	p				54.1	p
		-	diluted	2				31.5	p				53.8	p





Share of results of joint ventures and funds
Underlying profit before taxation					130		-	130		113		-	113
Net valuation movement (includes result on disposals)					-		(62)	(62)		-		72	72
Non-recurring items					-		(4)	(4)		-		(3)	(3)
Current tax income (expense)					-		2	2		-		(1)	(1)
Deferred tax income					-		1	1		-		1	1
Share of results of joint ventures and funds				9	130		(63)	67		113		69	182


All results derive from continuing operations.

*As defined in note 2

Consolidated Statement of Comprehensive Income
for the year ended 31 March 2013



	2013	2012
	£m	£m


Profit for the year after taxation	284	480

Other comprehensive income:
Items that will not be reclassified subsequently to profit or loss:
Net actuarial loss on pension scheme	(2)	(3)
	(2)	(3)

Items that may be reclassified subsequently to profit or loss:
Losses on cash flow hedges
- Group	(16)	(65)
- Joint ventures and funds	(6)	(50)
	(22)	(115)

Transferred to the income statement (cash flow hedges)
- foreign currency derivatives	(5)	-
- interest rate derivatives	26	18
	21	18

Exchange differences on translation of foreign operations
- hedging and translation	(4)	9
- other	6	(8)
	2	1


Other comprehensive loss for the year	(1)	(99)


Total comprehensive income for the year attributable to shareholders of the Company	283	381

Consolidated Balance Sheet
as at 31 March 2013


		2013		2012*
	Note	£m		£m
ASSETS
Non-current assets
Investment and development properties	8	5,488		5,346
Owner-occupied property	8	42		41
		5,530		5,387

Other non-current assets
Investments in joint ventures and funds	9	2,336		2,191
Other investments	10	76		28
Interest rate derivative assets	15	92		73
		8,034		7,679

Current assets
Trading properties	8	40		47
Debtors	11	60		95
Liquid investments	15	-		200
Cash and short-term deposits	15	135		137
		235		479

Total assets		8,269		8,158

LIABILITIES
Current liabilities
Short-term borrowings and overdrafts	15	(44)		(49)
Creditors	12	(259)		(261)
Corporation tax		(17)		(23)
		(320)		(333)

Non-current liabilities
Debentures and loans	15	(2,134)		(2,572)
Other non-current liabilities	13	(26)		(25)
Deferred tax liabilities	14	(16)		(32)
Interest rate derivative liabilities	15	(86)		(92)
		(2,262)		(2,721)

Total liabilities		(2,582)		(3,054)

Net assets		5,687		5,104

Equity
Share capital	18	249		225
Share premium		1,242		1,237
Merger reserve		213		-
Other reserves		(163)		(164)
Retained earnings		4,146		3,806

Total equity attributable to shareholders of the Company		5,687		5,104


EPRA NAV per share**	2	596	p	595	p


* Comparatives have been re-presented, see note 1.
** As defined in note 2.

Consolidated Statement of Cash Flows
for the year ended 31 March 2013


		2013	2012
	Note	£m	£m


Rental income received from tenants		266	271
Fees and other income received		19	21
Operating expenses paid to suppliers and employees		(88)	(81)
Cash generated from operations		197	211


Interest paid		(113)	(89)
Interest received		31	17
UK corporation tax received		1	3
Distributions and other receivables from joint ventures and funds		74	64
Net cash inflow from operating activities		190	206


Cash flows from investing activities
Development and other capital expenditure		(230)	(106)
Purchase of investment properties		(442)	(382)
Sale of investment properties		699	59
Purchase of investments		-	(22)
Sale of investments		2	-
Deferred consideration received		18	12
Investment in and loans to joint ventures and funds		(318)	(110)
Capital distributions received from joint ventures and funds		72	-
Indirect taxes (paid) received in respect of investing activities		(3)	2
Net cash outflow from investing activities		(202)	(547)


Cash flows from financing activities
Issue of ordinary shares		493	-
Dividends paid	16	(203)	(212)
Closeout of interest rate derivatives		4	-
Movement in other financial liabilities		2	(4)
Disposal of liquid investments	15	210	-
Decrease in bank and other borrowings		(889)	(406)
Drawdowns on bank and other borrowings		-	1,040
Proceeds on convertible bond issue		393	-
Net cash inflow from financing activities		10	418


Net (decrease) increase in cash and cash equivalents		(2)	77
Cash and cash equivalents at 1 April		137	60
Cash and cash equivalents at 31 March		135	137


Cash and cash equivalents consists of:
Cash and short-term deposits	15	135	137

Consolidated Statement of Changes in Equity
for the year ended 31 March 2013

				Hedging and
	Share		Share	translation		Revaluation		Merger		Retained
	capital	*	premium	reserve	*	reserve	*	reserve	*	earnings	Total
	£m		£m	£m	**	£m				£m	£m
Balance at 1 April 2012	225		1,237	(72)		(92)		-		3,806	5,104
Profit for the year after taxation	-		-	-		-		-		284	284
Losses on cash flow hedges	-		-	(16)		-		-		-	(16)
Joint ventures and funds revaluations	-		-	-		(6)		-		-	(6)
Reclassification of losses on cash flow hedges
- foreign currency derivatives	-		-	(5)		-		-		-	(5)
- interest rate derivatives	-		-	26		-		-		-	26
Exchange differences on translation of foreign operations	-		-	(4)		6		-		-	2
Net actuarial loss on pension schemes	-		-	-		-		-		(2)	(2)
Other comprehensive income (loss)	-		-	1		-		-		(2)	(1)
Total comprehensive income for the year	-		-	1		-		-		282	283
Share issues	24		5	-		-		464		-	493
Adjustment for share and share option awards	-		-	-		-		-		9	9
Dividends payable in year (26.3p per share)	-		-	-		-		-		(234)	(234)
Transfer	-		-	-		-		(251)		251	-
Adjustment for scrip dividend element	-		-	-		-		-		32	32
Balance at 31 March 2013	249		1,242	(71)		(92)		213		4,146	5,687


Balance at 1 April 2011	224		1,237	(34)		(34)		-		3,537	4,930
Profit for the year after taxation	-		-	-		-		-		480	480
Losses on cash flow hedges	-		-	(65)		-		-		-	(65)
Joint ventures and funds revaluations	-		-	-		(50)		-		-	(50)
Reclassification of losses on cash flow hedges
- interest rate derivatives	-		-	18		-		-		-	18
Exchange differences on translation of foreign operations	-		-	9		(8)		-		-	1
Net actuarial loss on pension schemes	-		-	-		-		-		(3)	(3)
Other comprehensive loss	-		-	(38)		(58)		-		(3)	(99)
Total comprehensive (loss) income for the year	-		-	(38)		(58)		-		477	381
Share issues	1		-	-		-		-		-	1
Adjustment for share and share option awards	-		-	-		-		-		5	5
Dividends payable in year (26.0p per share)	-		-	-		-		-		(231)	(231)
Adjustment for scrip dividend element	-		-	-		-		-		18	18
Balance at 31 March 2012	225		1,237	(72)		(92)		-		3,806	5,104
* refer to note 18.
** The balance at 1 April 2012 includes £11m relating to foreign exchange and (£83m) relating to hedging.

Notes to the accounts
for the year ended 31 March 2013

1. Basis of preparation

The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 March 2013 or 2012, but is derived from those accounts. Statutory accounts for 2012 have been delivered to the Registrar of Companies and those for 2013 will be delivered following the Company's annual general meeting. The auditor has reported on those accounts; their reports were unqualified, did not draw attention to any matters by way of emphasis and did not contain statements under s498(2) or (3) of Companies Act 2006 or equivalent preceding legislation.









The financial statements for the year ended 31 March 2013 have been prepared on the historical cost basis, except for the revaluation of properties, investments and derivatives. The financial statements have also been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and therefore comply with Article 4 of the EU IAS Regulation.



While the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of IFRSs, this announcement does not itself contain sufficient information to comply with IFRSs. The Company expects to publish full financial statements that comply with IFRSs in June 2013.




The accounting policies used are consistent with those contained in the Group's last annual report and accounts for the year ended 31 March 2012. Standards and interpretations issued but not effective for the current accounting period were: IFRS 9 - Financial Instruments; IFRS 10 - Consolidated Financial Statements; IFRS 11 - Joint Arrangements; IFRS 12 - Disclosure of Interests in Other Entities; IFRS 13 - Fair Value Measurement; IAS 1 (amended) - Presentation of Items of Other Comprehensive Income; IAS 12 (amended) - Deferred Tax: recovery of assets; IAS 19 (revised) - Employee Benefits; IAS 27 (revised) - Separate Financial Statements; IAS 28 (revised) - Investments in Associates and Joint Ventures and IAS 32 (amended) - Financial Instruments: Presentation.







The balance sheet has been re-presented to show interest rate derivative assets, interest rate derivative liabilities and corporation tax creditor on the face of the balance sheet, in accordance with IAS 1. Comparatives on the balance sheet and in the notes to the accounts have been re-presented accordingly. The tax withheld on dividends, previously disclosed within corporation tax creditors, has been re-presented in other taxation and social security.




The Directors do not expect that the adoption of the standards listed above will have a material impact on the financial statements of the Group in future periods except as follows: IFRS 9 will impact both the measurement and disclosures of financial instruments; IFRS 12 will impact the disclosure of interests the Group has in other entities; IFRS 13 will impact the disclosure of fair value measurements and IAS 19 (revised) will impact the measurement of the various components representing movements in the defined benefit pension obligation.

The financial statements have been prepared on the going concern basis as stated in the directors' responsibility statement.


2. Performance measures


	2013				2012
Earnings per share (diluted)	Earnings		Pence per share		Earnings			Pence per share
	£m				£m

Underlying pre-tax profit - income statement	274				269
Tax charge relating to underlying profit	(1)				(4)

Underlying earnings	273		30.3	p	265			29.7	p

Mark-to-market on / profit on disposal of liquid investments (held for trading assets)	9				(3)
Mark-to-market on convertible bond	(7)				-
Non-recurring items*	(7)				-

EPRA earnings	268		29.7	p	262			29.4	p

Profit for the year after taxation	284		31.5	p	480			53.8	p

*Non-recurring items for the year ended 31 March 2013 relate to £7m of issue costs for the convertible bond.


The European Public Real Estate Association (EPRA) issued Best Practices Recommendations most recently in September 2011 and additional guidance in January 2013, which gives guidelines for performance measures. Comparatives have been re-presented in line with the additional guidance. The EPRA earnings measure excludes investment property revaluations and gains or losses on disposals, intangible asset movements and their related taxation. A summary of the EPRA Performance Measures is provided in table B within the Supplementary Disclosures.





Underlying earnings consists of the EPRA earnings measure, with additional company adjustments. Adjustments include mark-to-market adjustments on, or profits on disposal of, held for trading assets, mark-to-market adjustments on the convertible bond and issue costs of the convertible bond.


The weighted average number of shares in issue for the year was: basic: 895m (2012: 887m); diluted for the effect of share options: 901m (2012: 892m). Basic undiluted earnings per share for the year, calculated using profit for the year after taxation of £284m (2012: £480m), was 31.7p (2012: 54.1p). Earnings per share shown in the table above are diluted.




					31 March			31 March
Net asset value (NAV) (diluted)					2013			2012
					£m			£m

Balance sheet net assets					5,687			5,104

Deferred tax arising on revaluation movements					14			31
Mark-to-market on effective cash flow hedges and related debt adjustments					198			189
Surplus on trading properties					10			-
Dilution effect of share options					58			57

EPRA NAV					5,967			5,381

EPRA NAV per share					596		p	595	p


The EPRA NAV per share excludes the mark-to-market on effective cash flow hedges and related debt adjustments, deferred taxation on revaluations and is calculated on a fully diluted basis.


At 31 March 2013, the number of shares in issue was: basic: 986m (2012: 888m); diluted for the effect of share options: 1,001m (2012: 904m).


Total accounting return per share for the year ended 31 March 2013 of 4.6% includes dividends paid of 26.4p (see note 16) in addition to the increase in EPRA NAV of 1p. Total accounting return per share for the year ended 31 March 2012 was 9.5%.

3. Gross and net rental and related income
		2013				2012
		£m				£m

Rent receivable		269				259
Spreading of tenant incentives and guaranteed rent increases		24				41
Surrender premia		1				-

Gross rental income		294				300

Service charge income		35				32

Gross rental and related income		329				332

Service charge expenses		(35)				(32)
Property operating expenses		(13)				(14)

Net rental and related income		281				286

The cash element of net rental income recognised during the year ended 31 March 2013 from properties which were not subject to a security interest was £159m (2012: £126m). Property operating expenses relating to investment properties that did not generate any rental income were £1m (2012: £1m). Contingent rents of £1m (2012: £1m) were recognised in the year.





4. Fees and other income
		2013				2012
		£m				£m

Performance and management fees (from joint ventures and funds)		10				12
Other fees and commissions		5				4

Fees and other income		15				16


5. Net revaluation gains on property and investments
		2013				2012
		£m				£m
Consolidated income statement
Revaluation of properties		71				143
Result on property and investment disposals		8				3
Revaluation of investments		9				(3)

		88				143
Share of valuation movements of joint ventures and funds		(62)				72

Net revaluation gains on property and investments		26				215

6. Net financing costs
	2013	2012
	£m	£m
Interest payable on:
Bank loans and overdrafts	37	27
Other loans	75	76
Obligations under finance leases	1	1

	113	104
Development interest capitalised	(17)	(8)

	96	96
Interest receivable on:
Deposits, securities and liquid investments	(11)	(17)
Loans to joint ventures	(3)	-

	(14)	(17)

Other finance (income) costs:

Expected return on pension scheme assets	(7)	(7)
Interest on pension scheme liabilities	5	5
Valuation movements on translation of foreign currency debt	5	-
Hedging reserve recycling	(5)	-

Net financing expenses - underlying	80	77

Capital and other:
Valuation movements on fair value debt	18	66
Valuation movements on fair value derivatives	(14)	(68)
Net capital movement on convertible bond	14	-
Recycling of fair value movement on close-out of derivatives	20	-
Valuation movement on translation of foreign currency net assets	(2)	-
Fair value movement on non-hedge accounted derivatives	3	4

Net financing costs - capital	39	2

Net financing costs	119	79

Total financing income	(23)	(26)
Total financing charges	142	105

Net financing costs	119	79


Interest on development expenditure is capitalised at a rate of 4.00% (2012: 4.48%).

7. Taxation
			2013	2012
			£m	£m
Tax (income) expense

Current tax:		UK corporation tax: 24% (2012: 26%)	1	2

			1	2
Adjustments in respect of prior periods			(9)	-


Total current tax expense (income)			(8)	2
Deferred tax on revaluations			(16)	(3)

Group total taxation (net)			(24)	(1)

Attributable to joint ventures and funds			(3)	-

Total taxation income			(27)	(1)

Tax reconciliation
Profit on ordinary activities before taxation			257	479
Less: profit attributable to joint ventures and funds*			(64)	(182)

Group profit on ordinary activities before taxation			193	297

Tax on profit on ordinary activities at UK corporation tax rate of 24% (2012: 26%)			46	77


Effects of:
	REIT exempt income and gains		(41)	(70)
	Tax losses		(6)	(8)
	Adjustments in respect of prior years		(23)	-

Group total taxation income			(24)	(1)

*A current tax credit of £2m (2012: charge of £1m) and a deferred tax credit of £1m (2012: credit of £1m) arose on profits attributable to joint ventures and funds. The low charges reflect the Group's REIT status.

Tax expense attributable to underlying profits for the year ended 31 March 2013 was £1m (2012: £4m). The underlying tax rate for the year ended 31 March 2013 was 0.5% (2012: 1.5%).


Corporation tax payable at 31 March 2013 was £17m (2012: £23m) as shown on the balance sheet.

8. Property

	Property reconciliation 12 months to 31 March 2013				Investment &	Trading	Owner-
					Development	Properties	occupied	Total
					£m	£m	£m	£m

Carrying value at 1 April 2012					5,346	47	41	5,434


Additions:		- property purchases			453	-	-	453
		- development expenditure			201	5	-	206
		- capitalised interest			15	1	-	16
		- capital expenditure on asset management initiatives			28	-	-	28

					697	6	-	703

Depreciation					-	-	(1)	(1)
Disposals					(651)	(13)	-	(664)
Revaluations included in income statement					72	-	2	74
Movement in tenant incentives and contracted rent uplift balances					24	-	-	24

Carrying value at 31 March 2013					5,488	40	42	5,570

Head lease liabilities (note 13)								(26)
Surplus on trading properties								10

Total Group property portfolio valuation at 31 March 2013								5,554


At 31 March 2013, the Group book value of properties of £5,554m (2012: £5,414m) comprises freeholds of £3,502m (2012: £4,034m); virtual freeholds of £709m (2012: £107m); and long leaseholds of £1,343m (2012: £1,273m). The historical cost of properties was £4,229m (2012: £4,264m).



The property valuation does not include any investment properties held under operating leases (2012: £nil).

Properties valued at £1,724m (2012: £1,827m) were subject to a security interest and other properties of non-recourse companies amounted to £40m (2012: £49m).


Included within the property valuation is £91m (2012: £86m) in respect of accrued contracted rental uplift income, against which the Group holds a provision of £5m (2012: £5m). The balance arises through the IFRS treatment of leases containing such arrangements which requires the recognition of rental income on a straight line basis over the lease term, with the difference between this and the cash receipt changing the carrying value of the property against which revaluations are measured.




Cumulative interest capitalised against investment properties amounts to £56m (2012: £78m).

Included in investment properties are £904m of properties which are in the course of development (2012: £444m).

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 2012, eighth edition, published by The Royal Institution of Chartered Surveyors.


Copies of the valuation certificates of Knight Frank LLP and CBRE can be found on the website at: www.britishland.com/investors/operational-performance.aspx

A breakdown of valuations split between the Group and its share of joint ventures and funds is shown below:

			2013			2012
			Group	Joint Ventures and Funds	Total	Group	Joint Ventures and Funds	Total
			£m	£m	£m	£m	£m	£m

Knight Frank LLP			5,084	2,680	7,764	5,133	2,577	7,710
CBRE			470	2,265	2,735	281	2,346	2,627
			5,554	4,945	10,499	5,414	4,923	10,337

9. Joint ventures and funds


Summary movement for the year of the investments in joint ventures and funds

		Joint Ventures	Funds	Total	Equity	Loans	Total
		£m	£m	£m	£m	£m	£m

At 1 April 2012		1,687	504	2,191	1,992	199	2,191
Additions		315	70	385	139	246	385
Disposals		(65)	(35)	(100)	(65)	(35)	(100)
Share of profit after taxation		128	(61)	67	67	-	67
Distributions and dividends:	Capital	(72)	-	(72)	(72)	-	(72)
	Revenue	(110)	(24)	(134)	(134)	-	(134)
Hedging and exchange movements		3	(4)	(1)	(1)	-	(1)

At 31 March 2013		1,886	450	2,336	1,926	410	2,336

PREF, a fund owning a portfolio of retail property in Europe (in which British Land has a net investment of £82m) is externally valued by CBRE. CBRE have included market uncertainty clauses in the valuation reports of the Spanish, Italian and Portuguese properties due to the lack of transactional evidence and uncertainty over the economic situation in these markets. In the 2014 calendar year PREF has €89m of bank loans that are due to mature, discussions are on-going with the existing lenders in relation to loan extensions and other alternatives are being explored.





At 31 March 2013 the investment in joint ventures included within the total investment in joint ventures and funds was £1,889m (2012: £1,690m).


Distributions in the year include the receipt of £24m from the Broadgate joint venture, £63m from the Meadowhall joint venture, £23m from the Sainsbury joint venture, £36m from Tesco joint ventures, £17m from HUT, £5m from PREF and £9m from Auchinlea. Of the total distributions made in the year £146m were settled in cash and £60m were settled via the transfer of other assets.



At 31 March 2013, the valuation of the Group's share of joint ventures and funds properties was £4,945m (2012: £4,923m); external net debt was £2,427m (2012: £2,576m) and the mark-to-market adjustment for external debt was £193m liability (2012: £5m asset).

9. Joint ventures and funds (continued): Joint ventures' summary financial statements

A detailed breakdown of the 100% results of specific joint ventures and funds is set out on the two following pages. The total column represents the Group's share of all joint ventures and funds. All disclosures have been restated to British Land accounting policies under IFRS eliminating all profits and losses resulting from upstream and downstream transactions with the Group.




	Bluebutton Properties Ltd	MSC Property Intermediate Holdings Ltd	BL Sainsbury Superstores Ltd	Tesco Joint Ventures	*	USS Joint Ventures**	Leadenhall Holding Co (Jersey) Ltd

Partners	Blackstone Group LP funds	Norges Bank Investment Management	J Sainsbury plc	Tesco PLC		Universities Superannuation Scheme	Oxford Properties

Property sector	City Offices	Shopping Centres	Superstores	Superstores		Shopping Centres	City Offices
	Broadgate	Meadowhall					Leadenhall
Group share	50%	50%	50%	50%		50%	50%

Date established	November 2009	February 2009	March 2008	November 1996		May 2007	Dec 2010

Accounting period	31 March	31 March	31 March	31 March		31 March	31 March
	2013	2013	2013	2013		2013	2013
Summarised income statements	£m	£m	£m	£m		£m	£m


Gross rental and related income	198	93	65	106		4	-

Net rental and related income	160	77	65	100		3	-
Other income and expenditure	(1)	(8)	(1)	(2)		-	-
Net interest payable (receivable)	(95)	(51)	(31)	(58)		-	-

Underlying profit before taxation	64	18	33	40		3	-
Surplus (deficit) on revaluation	53	24	(18)	(11)		18	5
Disposal of fixed assets	-	-	(1)	(1)		-	-
Non-recurring items	-	1	-	(2)		(2)	-

Profit (loss) on ordinary activities before taxation	117	43	14	26		19	5
Current tax	-	-	-	-		-	-
Deferred tax	-	-	-	-		-	-

Profit (loss) on ordinary activities after taxation	117	43	14	26		19	5


Summarised balance sheets	£m	£m	£m	£m		£m	£m

Investment properties	3,042	1,530	1,203	1,700		164	318
Current assets	22	2	1	1		-	5
Upstream loans to joint venture shareholders	-	-	-	-		-	-
Cash and deposits	266	38	21	33		6	1
Gross assets	3,330	1,570	1,225	1,734		170	324

Current liabilities	(238)	(43)	(35)	(174)		(3)	(12)
Bank debt falling due within one year	(185)	-	-	-		-	-
Bank debt falling due after one year	(52)	-	-	(1,007)		-	-
Securitised debt	(1,809)	(766)	(609)	-		-	-
Other non-current liabilities	-	-	-	-		-	-
Obligations under finance leases	-	(5)	-	-		-	-
Deferred tax	-	-	-	-		-	-
Gross liabilities	(2,284)	(814)	(644)	(1,181)		(3)	(12)

Net external assets	1,046	756	581	553		167	312

Represented by:
Shareholder loans	15	204	15	95		12	259
Ordinary shareholders' funds/partners' capital	1,031	552	566	458		155	53
Total investment	1,046	756	581	553		167	312


*Tesco joint ventures include BLT Holdings (2010) Limited, the Tesco British Land Property Partnership, Tesco BL Holdings Limited, Shopping Centres Limited and the Tesco Aqua Limited Partnership.

** USS joint ventures include the Eden Walk Shopping Centre Unit Trust and the Fareham Property Partnership.

9. Joint ventures and funds (continued): joint ventures' and funds' summary financial statements

A detailed breakdown of the 100% results of specific joint ventures and funds is set out on the current and previous page. The total column represents the Group's share of all joint ventures and funds. All disclosures have been restated to British Land accounting policies under IFRS eliminating all profits and losses resulting from upstream and downstream transactions with the Group.



						Joint Ventures and Funds	Joint Ventures and Funds
	Hercules	Pillar Retail		Other		TOTAL	TOTAL
	Unit	Europark		joint ventures		Group share	Group share
	Trust	Fund	+	and funds	+*	2013	2012
Partners

Property sector	Retail	Retail
	Parks	Parks

Group share	41.24%	65.30%

Date established	September 2000	March 2004

Accounting period	31 March	31 March
	2013	2013
Summarised income statements	£m	£m		£m		£m	£m


Gross rental and related income	95	28		16		306	298

Net rental and related income	85	19		10		260	260
Other income and expenditure	(3)	(1)		4		(4)	(6)
Net interest payable (receivable)	(28)	(7)		8		(126)	(141)

Underlying profit before taxation	54	11		22		130	113
Surplus (deficit) on revaluation	(83)	(91)		(3)		(61)	71
Disposal of fixed assets	-	-		-		(1)	1
Non-recurring items	(4)	-		(1)		(4)	(3)

Profit (loss) on ordinary activities before taxation	(33)	(80)		18		64	182
Current tax	-	-		2		2	(1)
Deferred tax	-	3		(1)		1	1

Profit (loss) on ordinary activities after taxation	(33)	(77)		19		67	182


Summarised balance sheets

Investment properties	1,496	204		220		4,949	4,931
Current assets	5	36		21		62	67
Upstream loans to joint venture shareholders	-	-		4		4	14
Cash and deposits	38	15		7		215	146
Gross assets	1,539	255		252		5,230	5,158

Current liabilities	(36)	(55)		(37)		(340)	(303)
Bank debt falling due within one year	-	(51)		(1)		(127)	(63)
Bank debt falling due after one year	(619)	(24)		(28)		(828)	(702)
Securitised debt	-	-		-		(1,592)	(1,842)
Other non-current liabilities	-	-		-		-	(45)
Obligations under finance leases	-	-		(2)		(5)	(9)
Deferred tax	-	-		(2)		(2)	(3)
Gross liabilities	(655)	(130)		(70)		2,894	(2,967)

Net external assets	884	125		182		2,336	2,191

Represented by:
Shareholder loans	-	62		135		477	266
Ordinary shareholders' funds/partners' capital	884	63		47		1,859	1,925
Total investment	884	125		182		2,336	2,191


+Although the Group's ownership share is 65.30%, it does not exercise control over significant decisions. The Group therefore equity accounts for its interest in Pillar Retail Europark Fund (PREF).


+*Included in the column headed 'Other joint ventures and funds' are contributions from the following: the BL Goodman Limited Partnership, the Scottish Retail Property Limited Partnership, BL Gazeley Limited, BL Canada Quays Limited, Eurofund Investments Zaragoza S.L., Hercules Income Fund (HIF), the City of London Office Unit Trust (CLOUT), Auchinlea Partnership and Group consolidation adjustments. Amounts are included in this column at the relevant percentage for the Group's interest.




The borrowings of joint ventures and funds and their subsidiaries are non-recourse to the Group. All joint ventures are incorporated in the United Kingdom, with the exception of Bluebutton Properties Limited, the Eden Walk Shopping Centre Unit Trust, Leadenhall Holding Co (Jersey) Limited and the Scottish Retail Property Limited Partnership which are domiciled in Jersey and Eurofund Investments Zaragoza S.L. which is domiciled in Spain. Of the funds, Hercules Unit Trust (HUT) and Hercules Income Fund (HIF) are domiciled in Jersey and PREF in Luxembourg.

9. Joint ventures and funds (continued)

Operating cash flows of joint ventures and funds (Group share)
							2013			2012
							£m			£m

Rental income received from tenants							264			277
Operating expenses paid to suppliers and employees							(22)			(28)

Cash generated from operations							242			249

Interest paid							(133)			(144)
UK corporation tax paid							(7)			(8)

Cash inflow from operating activities							102			97

Cash inflow from operating activities deployed as:

Surplus cash retained within joint ventures and funds							28			33

Revenue distributions to British Land							74			64

							102			97


10. Other investments
										£m

At 1 April 2012										28
Additions										53
Disposals										(4)
Depreciation										(1)

At 31 March 2013										76

Included within additions is £53m in relation to a loan to Bluebutton Properties Limited, a joint venture company.



11. Debtors
							2013			2012
							£m			£m

Trade and other debtors+							15			29
Amounts owed by joint ventures							40			57
Prepayments and accrued income							5			9

Debtors							60			95

+ Included within this balance is deferred consideration of £4m (2012: £4m) arising on the sale of investment properties for which the timing of the receipt is contingent and therefore may fall due after one year.


Comparatives have been re-presented, see note 1.

Trade and other debtors are shown after deducting a provision for bad and doubtful debts of £11m (2012: £10m). The charge to the income statement was £1m (2012: £1m).


The Directors consider that the carrying amount of trade and other debtors approximates to their fair value. There is no concentration of credit risk with respect to trade debtors as the Group has a large number of customers who are paying their rent in advance.



12. Creditors
						2013			2012
						£m			£m

Trade creditors						94			88
Amounts owed to joint ventures						4			15
Other taxation and social security						24			27
Accruals and deferred income						137			131

Creditors						259			261

Comparatives have been re-presented, see note 1.

Trade creditors are interest-free and have settlement dates within one year. The Directors consider that the carrying amount of trade and other creditors approximates to their fair value.




13. Other non-current liabilities
						2013			2012
						£m			£m

Trade and other creditors						-			5
Head leases						26			20

Other non-current liabilities						26			25



14. Deferred Taxation

Deferred tax is calculated on temporary differences under the liability method using a tax rate of 23% (2012: 24%).
The movement in deferred tax is shown below:

				1 April		Credited			31 March
				2012		to income			2013
				£m		£m			£m

Property and investment revaluations				28		(16)			12
Other timing differences				4		-			4

Deferred taxation				32		(16)			16


Under the REIT regime development properties which are sold within three years of completion do not benefit from tax exemption. At 31 March 2013 the value of such properties is £nil (2012: £763m) and if these properties were to be sold and tax exemption was not available the tax arising would be £nil (2012: £30m)



The deferred tax charge for the year ended 31 March 2013 includes a credit of £1m to reflect reduced deferred tax liabilities arising from the forthcoming reduction in the UK corporation tax rate to 23% (effective from 1 April 2013).


Deferred tax assets of £40m (2012: £41m) arising on losses from previous years have not been recognised in the financial year.





15. Net debt
								2013			2012
					Footnote			£m			£m
Secured on the assets of the Group
9.125% First Mortgage Debenture Stock 2020					1			37			37
6.125% First Mortgage Debenture Stock 2014					1			45			46
5.264% First Mortgage Debenture Bonds 2035								345			341
5.0055% First Mortgage Amortising Debentures 2035								101			102
5.357% First Mortgage Debenture Bonds 2028								334			322
6.75% First Mortgage Debenture Bonds 2020								181			179
Loan notes								5			5

								1,048			1,032
Unsecured
5.50% Senior Notes 2027								98			98
6.30% Senior US Dollar Notes 2015					2			101			96
3.895% Senior US Dollar Notes 2018					3			28			26
4.635% Senior US Dollar Notes 2021					3			158			145
4.766% Senior US Dollar Notes 2023					3			97			89
5.003% Senior US Dollar Notes 2026					3			62			57
1.5% Convertible Bond 2017								407			-
Bank loans and overdrafts								179			1,078

								1,130			1,589
Gross debt					4			2,178			2,621

Interest rate derivatives: liabilities								86			92
Interest rate derivatives: assets								(92)			(73)

								2,172			2,640
Liquid investments
4.405% Medium Term Note 2015								-			(100)
4.395% Medium Term Note 2015								-			(100)
								-			(200)

Cash and short-term deposits					5			(135)			(137)

Net debt								2,037			2,303

Total borrowings where any instalments are due after five years are £103m (2012: £104m).

								2013			2012
1	These borrowings are obligations of ring-fenced, special purpose companies, with no recourse to other companies or assets in the Group:							£m			£m
			BLD Property Holdings Ltd					82			83
2	Principal and interest on this borrowing was fully hedged into Sterling at the time of issue.
3	Principal and interest on this borrowing was fully hedged into Sterling at a floating rate at the time of issue.
4	The principal amount of gross debt at 31 March 2013 was £2,063m (2012: £2,562m). Included in this, the principal amount of secured borrowings and other borrowings of non-recourse companies was £981m (2012: £982m).

5	Cash and deposits not subject to a security interest amount to £106m (2012: £132m).


Maturity analysis of net debt								2013			2012
								£m			£m

Repayable:		within one year and on demand						44			49
between:		one and two years						188			405
		two and five years						522			776
		five and ten years						441			422
		ten and fifteen years						602			260
		fifteen and twenty years						5			332
		twenty and twenty five years						376			377
								2,134			2,572
Gross debt								2,178			2,621
Interest rate and currency derivatives								(6)			19
Liquid Investments								-			(200)
Cash and short-term deposits								(135)			(137)

Net debt								2,037			2,303

15. Net debt (continued)

The two financial covenants applicable to the Group unsecured debt including convertible bonds are:

Net Borrowings not to exceed 175% of Adjusted Capital and Reserves
At 31 March 2013, the ratio is 31%:
i. Net Borrowings are £1,962m, being the principal amount of gross debt of £2,063m plus amounts owed to joint ventures of £4m plus TPP Investments Ltd of £30m (see note 17), less the cash and short-term deposits of £135m; and

ii. Adjusted Capital and Reserves are £6,242m, being share capital and reserves of £5,687m (see consolidated statement of changes in equity), adjusted for £14m of deferred tax (see note 2), £10m trading property surplus, £326m exceptional refinancing charges (see below) and £205m fair value adjustments on financial assets and liabilities (£198m mark-to-market on interest rate swaps and £7m fair value adjustment on the convertible bond).




Net Unsecured Borrowings not to exceed 70% of Unencumbered Assets
At 31 March 2013 the ratio is 23%:
i. Net Unsecured Borrowings are £980m, being the principal amount of gross debt of £2,063m plus amounts owed to joint ventures of £4m less cash and deposits not subject to a security interest of £106m less the principal amount of secured and non-recourse borrowings of £981m; and


ii. Unencumbered Assets are £4,313m being properties of £5,554m (see note 8) plus investments in joint ventures and funds of £2,336m (see note 9) and other investments of £76m (see balance sheet) less investments in joint ventures of £1,889m (see note 9) and encumbered assets of £1,764m (see note 8).



In calculating Adjusted Capital and Reserves for the purpose of the unsecured debt financial covenants, there is an adjustment of £326m to reflect the cumulative net amortised exceptional items relating to the refinancings in the years ended 31 March 2005, 2006 and 2007.



Interest rate profile - including effect of derivatives
			2013	2012
			£m	£m

Fixed rate			1,848	1,976
Variable rate (net of cash)			189	327

Net debt			2,037	2,303

Reconciliation of movement in Group net debt to cash flow statement

	2012	Cash flow	Non cash	2013
	£m	£m	£m	£m

Per cash flow statement:
Cash and short-term deposits	(137)	2	-	(135)
Cash and cash equivalents	(137)	2	-	(135)

Term debt (excluding overdrafts)	2,621	(496)	53	2,178
Fair value of interest rate derivatives	19	-	(25)	(6)
Liquid investments	(200)	210	(10)	-

Net debt	2,303	(284)	18	2,037

The Group Loan to Value (LTV) ratio at 31 March 2013 is 24%, being principal value of gross debt of £2,063m less cash and short-term deposits of £135m, divided by total Group property of £5,554m (see note 8) plus investments in joint ventures and funds of £2,336m (balance sheet) and other investments of £76m (see balance sheet).

15. Net debt (continued)


Maturity of committed undrawn borrowing facilities

		2013	2012
		£m	£m
Maturity date:

between four and five years		108	825
between three and four years		870	-
Total facilities available for more than three years		978	825

between two and three years		-	280
between one and two years		757	100
within one year		369	35

Total		2,104	1,240

The above facilities are available to be drawn for Group purposes.


Comparison of market values and book values at 31 March 2013

	Market	Book
	Value	Value	Difference
	£m	£m	£m

Debentures and unsecured bonds	1,622	1,587	35
Convertible bond	407	407	-
Bank debt and other floating rate debt	189	184	5
Cash and short-term deposits	(135)	(135)	-

	2,083	2,043	40

Other financial (assets) liabilities:
- interest rate derivative assets	(92)	(92)	-
- interest rate derivative liabilities	86	86	-

	(6)	(6)	-

Total	2,077	2,037	40

Short-term debtors and creditors have been excluded from the disclosures.

The fair values of debt and debentures have been established by obtaining quoted market prices from brokers. The bank debt and loan notes have been valued assuming they 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.




Convertible Bond
On 10 September 2012 British Land (Jersey) Limited (the Issuer) issued £400 million 1.5 per cent guaranteed convertible bonds due 2017 (the bonds) at par. The Company has unconditionally and irrevocably guaranteed the due and punctual performance by the Issuer of all of its obligations (including payments) in respect of the bonds and the obligations of the Company, as guarantor, constitute direct, unsubordinated unconditional and unsecured obligations of the Company. Subject to their terms, the 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. The bonds can be converted from 22 October 2012 up to and including 24 September 2015 if the share price has traded at a level exceeding 130 per cent of the exchange price for a specified period and from 25 September 2015 to (but excluding) the 20th dealing day before 10 September 2017 (the maturity date) at any time. The initial exchange price was 693.07 pence per ordinary share. Under the terms of the bonds, the exchange price is adjusted on the happening of certain events including the payment of dividends by the Company above 26.4 pence in any year. On or after 25 September 2015, the bonds may be redeemed at par at the Company's option subject to the Company's ordinary shares having traded at a price exceeding 130 per cent of the exchange price for a specified period, or at any time once 85 per cent by nominal value of the bonds originally issued have been converted, redeemed, or purchased and cancelled. If not previously converted, redeemed or purchased and cancelled, the bonds will be redeemed at par on the maturity date.

16. Dividend

The fourth quarter dividend of 6.6 pence per share, totalling £65m (2012: 6.6 pence per share, totalling £58m) was approved by the Board on 13 May 2013 and is payable on 9 August 2013 to shareholders on the register at the close of business on 5 July 2013.



The Board will announce the availability of the Scrip Dividend Alternative via the Regulatory News Service and on its website (www.britishland.com), no later than four business days before the ex-dividend date of 3 July 2013. The Board expects to announce the split between PID (Property Income Distribution) and non-PID income at that time. Any Scrip Dividend Alternative will not be enhanced. 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.









Payment Date	Dividend	PID		Non PID	Pence per share	2013 £m	2012 £m

Current year dividends
09.08.2013	2013 4th interim				6.60	-	-
10.05.2013	2013 3rd interim	6.60	*		6.60	-	-
15.02.2013	2013 2nd interim	6.60	*		6.60	59	-
09.11.2012	2013 1st interim	6.60	*		6.60	59	-
					26.40
Prior year dividends
10.08.2012	2012 4th interim	3.30		3.30	6.60	58	-
9.05.2012	2012 3rd interim	6.50			6.50	58	-
17.02.2012	2012 2nd interim	6.50			6.50	-	58
11.11.2011	2012 1st interim	6.50			6.50	-	58
					26.10

12.08.2011	2011 4th interim	6.50			6.50	-	58
13.05.2011	2011 3rd interim	6.50			6.50	-	57

Dividends in consolidated statement of changes in equity						234	231
Dividends settled in shares						(32)	(18)
Dividends settled in cash						202	213
Timing difference relating to payment of withholding tax						1	(1)
Dividends in cash flow statement						203	212

* Scrip alternative treated as non-PID for this dividend.



17. Contingent liabilities

The Group has 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.


TPP Investments Limited, a wholly owned, ring-fenced special purpose subsidiary, is a partner in The Tesco British Land Property Partnership and, in that capacity, has entered into a secured bank loan under which its liability is limited to £30m (2012: £30m) and recourse is only to the partnership assets.

18. Share capital and reserves

		2013		2012
Number of ordinary shares in issue at 1 April	900,199,638		897,042,298

Share issues	97,491,850		3,157,340

At 31 March	997,691,488		900,199,638

Of the issued 25p ordinary shares, 275,497 shares were held in the ESOP trust (2012: 1,370,161), 11,266,245 shares were held as treasury shares (2012: 11,266,245) and 986,149,746 shares were in free issue (2012: 887,563,232). No treasury shares were acquired by the ESOP trust during the year. All issued shares are fully paid.



On 12 March 2013, the Company announced the placing of 89,674,604 new ordinary shares at a price of 550 pence per share. The new shares are fully paid and rank pari passu in all respects with those ordinary shares of the Company in issue prior to the placing.


Hedging and translation reserve

The hedging and translation reserve comprises the effective portion of the cumulative net change in the fair value of cash flow and foreign currency hedging instruments, as well as all foreign exchange differences arising from the translation of the financial statements of foreign operations. The foreign exchange differences also include the translation of the liabilities that hedge the Company's net investment in a foreign subsidiary.




Revaluation reserve

The revaluation reserve relates to owner-occupied properties and investments in joint ventures and funds.

Merger reserve

This comprises the premium on the share placing in March 2013. No share premium is recorded in the Company's financial statements, through the operation of the Merger Relief provisions of the Companies Act 2006.

19. Segment Information

Operating segments
The segmental note has been updated to reflect changes to internal management reporting. The Group allocates resources to investment and asset management according to the sectors it expects to perform over the medium term. Its two principal sectors are currently offices and retail. Prior year comparatives have been updated to reflect this change. The relevant revenue, net rental income, operating result, assets and capital expenditure, being the measure of segment revenue, segment result and segment assets used by the management of the business, are set out below. Revenue is derived from the rental of buildings. Operating result is the net of net rental income, fee income and administration expenses. No customer exceeds 10% of the Group's revenues in either year.

Segment Result	Offices		Retail		Other / unallocated		Total
	2013	2012	2013	2012	2013	2012	2013	2012
	£m	£m	£m	£m	£m	£m	£m	£m


Revenue
British Land Group	85	87	176	184	33	29	294	300
Share of joint ventures and funds	83	82	190	189	-	1	273	272
Total	168	169	366	373	33	30	567	572

Net rental income
British Land Group	82	77	167	175	32	34	281	286
Share of joint ventures and funds	80	80	180	180	-	-	260	260
Total	162	157	347	355	32	34	541	546

Operating Result
British Land Group	72	77	159	174	(7)	(18)	224	233
Share of joint ventures and funds	80	80	175	172	1	2	256	254
Total	152	157	334	346	(6)	(16)	480	487

Reconciliation to underlying profit before taxation
							2013	2012
British Land Group							£m	£m
Total operating result							480	487
British Land Group net financing costs							(80)	(77)
Share of joint ventures and funds net financing costs							(126)	(141)
Capital and other							(14)	210
Total profit on ordinary activities before tax							260	479

Of the total revenues above, £19m (2012: £17m) was derived from outside the UK.

Segment Assets	Offices		Retail		Other / unallocated		Total
	2013	2012	2013	2012	2013	2012	2013	2012
	£m	£m	£m	£m	£m	£m	£m	£m


Property assets (includes head leases liabilities)
British Land Group	2,033	2,017	3,071	2,946	450	451	5,554	5,414
Share of joint ventures and funds	1,684	1,545	3,256	3,372	5	6	4,945	4,923
Total	3,717	3,562	6,327	6,318	455	457	10,499	10,337

Segment assets
British Land Group	2,039	2,023	3,080	2,949	814	995	5,933	5,967
Share of joint ventures and funds	1,839	1,628	3,367	3,517	12	14	5,218	5,159
Total	3,878	3,651	6,447	6,466	826	1,009	11,151	11,126

Other assets
British Land Group	-	-	-	-	363	533	363	533
Share of joint ventures and funds	155	83	107	137	7	8	269	228
Total	155	83	107	137	370	541	632	761

Capital expenditure
British Land Group	391	148	315	27	47	347	753	522
Share of joint ventures and funds	109	113	26	83	-	-	135	196
Total	500	261	341	110	47	347	888	718

Other assets include other investments of £76m (2012: £28m), debtors of £60m (2012: £95m), liquid investments of £nil (2012: £200m), cash of £135m (2012: £137m) and derivatives of £92m (2012: £73m).

Supplementary Disclosures


Table A: SUMMARY INCOME STATEMENT AND BALANCE SHEET

Summary income statement based on proportional consolidation for the year ended 31 March 2013

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, i.e. proportional, basis. The underlying profit before taxation and underlying profit after taxation are the same as presented in the consolidated income statement.




	31 March 2013				31 March 2012
	Group	Joint ventures	Proportionally		Group	Joint ventures	Proportionally
		and funds	Consolidated			and funds	Consolidated
	£m	£m	£m		£m	£m	£m

Gross rental income	294	273	567		300	272	572

Property operating expenses	(13)	(13)	(26)		(14)	(12)	(26)

Net rental income	281	260	541		286	260	546

Administrative expenses	(72)	(4)	(76)		(69)	(7)	(76)

Fees and other income	15	-	15		16	1	17

Ungeared income return	224	256	480		233	254	487

Net interest	(80)	(126)	(206)		(77)	(141)	(218)

Underlying profit before taxation	144	130	274		156	113	269

Underlying tax	(1)	-	(1)		(2)	(2)	(4)

Underlying profit after taxation	143	130	273		154	111	265

Underlying earnings per share - diluted basis			30.3	p			29.7	p

Valuation movement			26				215

Other capital and tax (net)*			(4)				13

Capital and other			22				228

Total return			295				493

*includes other comprehensive income, movement in dilution of share options and the movement in items excluded for EPRA NAV.

The underlying earnings per share is calculated on underlying profit before taxation of £274m, tax attributable to underlying profits of £1m and 901m shares on a diluted basis for the year ended 31 March 2013.

Supplementary Disclosures (continued)

Table A (continued):


Summary balance sheet based on proportional consolidation as at 31 March 2013

The following pro forma information is unaudited and does not form part of the consolidated primary statements or the notes thereto. It presents the composition of the EPRA net assets of the Group, with its share of the net assets of the joint venture and fund assets and liabilities included on a line-by-line, i.e. proportional basis and assuming full dilution.



	Group	Share of joint ventures & funds	Share options	Deferred tax	Mark-to-Market of interest rate swaps	Head Leases	Valuation surplus on trading properties		EPRA Net assets 2013		EPRA Net assets 2012
	£m	£m	£m	£m	£m	£m	£m		£m		£m

Retail properties	3,080	3,260	-	-	-	(13)	-		6,327		6,318

Office properties	2,039	1,684	-	-	-	(6)	-		3,717		3,562

Other properties	451	5	-	-	-	(11)	10		455		457


Total properties	5,570	4,949	-	-	-	(30)	10		10,499		10,337

Investments in joint	2,336	(2,336)	-	-	-	-	-		-		-
ventures and funds

Other investments	76	(23)	-	-	-	-	-		53		28

Other net (liabilities) assets	(258)	(163)	58	14	-	30	-		(319)		(294)

Net debt	(2,037)	(2,427)	-	-	198	-	-		(4,266)		(4,690)

Net assets	5,687	-	58	14	198	-	10		5,967		5,381

EPRA NAV per share (note 2)									596	p	595	p





EPRA Net Assets Movement

						31 March 2013			31 March 2012
						£m	Pence per share		£m		Pence per share

Opening EPRA NAV						5,381	595	p	5,101		567	p

Income return						273	30	p	265		29	p

Capital return						22	2	p	228		25	p

Dividend paid						(202)	(27)	p	(213)		(26)	p

Dilution due to issues of shares						493	(4)	p	-		-

Closing EPRA NAV						5,967	596	p	5,381		595	p

Supplementary Disclosures (continued)

Table B: EPRA PERFORMANCE MEASURES


EPRA Performance measures summary table
		2013			2012
	£m	Pence per share		£m	Pence per share

EPRA earnings	268	29.7	p	262	29.4	p

EPRA NAV	5,967	596	p	5,381	595	p

EPRA NNNAV	5,522	552	p	5,148	569	p

EPRA net initial yield		5.5	%		5.2	%

EPRA 'topped-up' net initial yield		5.7	%		5.8	%

EPRA vacancy rate		3.3	%		2.4	%



Calculation of EPRA earnings and EPRA earnings per share				2013	2012
				£m	£m

Profit for the year after taxation				284	480
Exclude
Group - non-underlying current tax				(9)	-
Group - deferred tax				(16)	(3)
Joint ventures and funds - non-underlying current tax				(2)	(1)
Joint ventures and funds - deferred tax				(1)	(1)
Group - net valuation movement (including result on disposals)				(79)	(146)
Joint ventures and funds - net valuation movement (including result on disposals)				62	(72)
Amortisation of intangible assets				1	-
Changes in fair value of financial instruments and associated close-out costs				28	5

EPRA earnings*				268	262

Mark-to-market on / profit on disposal of liquid investments (held for trading assets)				(9)	3
Mark-to-market on convertible bond				7	-
Non-recurring items**				7	-

Underlying earnings				273	265

* Comparatives have been re-presented in line with updated EPRA guidance.
**Non-recurring items for the year ended 31 March 2013 relate to £7m of issue costs for the convertible bond.

				2013	2012
				Number	Number
				million	million

Weighted average number of shares				907	899

Adjustment for treasury shares				(11)	(11)

Adjustment for ESOP shares				(1)	(1)

Weighted average number of shares (basic)				895	887

Dilutive effect of share options				2	2

Dilutive effect of ESOP shares				4	3

Weighted average number of shares (diluted)				901	892


				2013	2012
				Pence	Pence

Earnings per share (basic)				31.7	54.1

Earnings per share (diluted)				31.5	53.8


Underlying earnings per share (diluted)				30.3	29.7

EPRA earnings per share				29.7	29.4

.

Supplementary Disclosures (continued)

Table B (continued):




Net assets per share		2013			2012
	£m	Pence per share		£m	Pence per share

Balance sheet net assets	5,687			5,104

Deferred tax arising on revaluation movements	14			31
Mark-to-market on effective cash flow hedges and related debt adjustments	198			189
Dilution effect of share options	58			57
Surplus on trading properties	10			-
EPRA NAV	5,967	596	p	5,381	595	p

Deferred tax arising on revaluation movements	(14)			(31)
Mark-to-market on effective cash flow hedges and related debt adjustments	(198)			(189)
Mark-to-market on debt	(233)			(13)

EPRA NNNAV	5,522	552	p	5,148	569	p

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.





EPRA Net Initial Yield and 'topped-up' Net Initial Yield
		2013			2012
		£m			£m
Investment property - wholly-owned		5,554			5,414
Investment property - share of joint ventures and funds		4,945			4,923
Less developments, residential and land		(1,340)			(835)

Completed property portfolio		9,159			9,502
Allowance for estimated purchasers' costs		552			521

Gross up completed property portfolio valuation		9,711			10,023

Annualised cash passing rental income		541			531
Property outgoings		(11)			(8)

Annualised net rents		530			523

Rent expiration of rent-free periods and fixed uplifts*		27			57

'Topped-up' net annualised rent		557			580
EPRA Net Initial Yield		5.5	%		5.2	%
EPRA 'topped-up' Net Initial Yield		5.7	%		5.8	%

Including fixed/minimum uplifts received in lieu of rental growth		26			27

Total 'topped-up' net rents		583			607
Overall 'topped-up' Net Initial Yield		6.0	%		6.1	%

'Topped-up' net annualised rent		557			580
ERV vacant space		19			14
Reversions		-			(18)
Total ERV		576			576
Net Reversionary Yield		5.9	%		5.7	%
* The period over which rent-free periods expire is 2 years (2012: 3 years).

EPRA Vacancy Rate
		2013			2012
		£m			£m
Annualised potential rental value of vacant premises		19			14
Annualised potential rental value for the completed property portfolio		576			576
EPRA vacancy rate		3.3	%		2.4	%

Supplementary Disclosures (continued)

Table C: GROSS RENTAL INCOME AND ACCOUNTING RETURN

Calculation of gross rental income

				31 March	31 March
				2013	2012
				£m	£m


Rent receivable				538	533
Spreading of tenant incentives and guaranteed rent increases				28	38
Surrender premia				1	1

Gross rental income				567	572




	31 March 2013			31 March 2012


Total accounting return		4.6	%		9.5	%

This information is provided by RNS

The company news service from the London Stock Exchange

END

FR UORUROBAVAUR