Intu Properties’ £503m loss for the six months to June disappointed the market and sent its share price plunging 9.09% on Thursday, its biggest fall since the more than 15% in June 2016, the day after the Brexit vote.
Intu’s £503m loss for the period was due to downward valuations of its properties.
Presenting his last set of results as CEO, David Fischel said he would resign from the group in the coming months once a successor was found. Some of his support staff would also leave.
Fischel had been in charge of Intu since 2001 and helped to build the group into a well-known UK property company with a portfolio worth £10bn.
While Intu and its peers have all seen the value of their UK properties fall, especially those in London as fund managers attach increasing risk to an uncertain Brexit process, one analyst said Intu was in need of a more active management.
“Management do not have the best track record in shareholder value creation, as evidenced by the long-term under-performance. There has been limited active management of the portfolio,” said Peter Clark, a portfolio manager at Investec Asset Management.
Intu’s revenue earned during the reporting period fell 6.9% to £286m. However, it still managed to maintain its interim dividend at 4.6p per share.
Fischel said Intu still owned high-quality businesses that could perform in weak and strong environments.
“During a period of weakening sentiment in the retail market, which has impacted prime shopping centre valuations, Intu has delivered a resilient operational performance in the first half of 2018. This reflects the high quality of our business, which was able to perform in a challenging retail environment.”
Clark said the results showed a more realistic view of what the assets were worth and devaluations were expected.