Revenues surge 110% to £11.8 million largely on foodstore developments
Property developer Terrace Hill Group has reported a return to profit as revenues surged 110 per cent in the year to September 30.
The Glasgow-based company, which has shifted its focus from residential developments to foodstores, office and student accommodation, reports revenues rose from £5.6 million last year to £11.8 million.
The group has turned around a pre-tax loss of £10.2 million last year to report a pre-tax profit of £1.8 million for the year, the bulk of which came from four foodstore developments.
However, revenue from development sales dropped from £45.1 million last year to £15.5 million.
Net debt was reduced by £4.2 million in the financial year to now stand at £47.2 million.
Terrace Hill said its foodstore development business has continued to perform strongly with three new stores pre-let with a further four sites currently at the planning stage and nine further sites currently under consideration.
Since shifting the group focus from residential to commercial development three years ago, Terrace Hill has sold seven sites to retailers representing more than half-a-million square foot of retail space with a capital value of £121 million.
The group said although there had been “some slackening in the pace” of retail expansion there are still “exciting opportunities” to expand the group's foodstore development pipeline.
Contracts have also been exchanged with Darlington Borough Council for a new £30 million lesiure complex which is being anchored by a nine-screen Vue cinema and an 80-bedroom Whitbread hotel.
The group completed a 29,000 sq. ft retail and office development on Savile Row in London in the financial year and has also began work on a 1,100-bed student residence in Southampton which is being forward funded by Legal and General.
A £160 million joint venture development at Howick Place in Victoria in London, comprising 135,00 sq. ft office and 25.300 sq.ft of residential apartments, is reported to be generating “strong interest”.
Terrace Hill said its residential property portfolio sale is “progressing ahead of schedule” having made £97.1 million of disposals in the financial year with the remainder of the portfolio expected to be divested in the coming 12 to 18 months.
Terrace Hill Residential PLC, which is based in Scotland, posted a loss of £4.84 million for the year on assets valued at £165.7 million and carries bank debt of £165.1 million.
The group has provided a £15 million guarantee to the lenders for Terrace Hill Residential PLC and increased its provision against its investment in the affiliate company by a further £5.1 million to £6 million in total at the year end.
Group chief executive Philip Leech said: "2012 has been a very active year for Terrace Hill during which we have progressed numerous foodstore developments, as well as new opportunities in the student accommodation, leisure and central London office sectors.
“This activity has translated into a good financial performance and we are confident of maintaining this positive momentum going forward.”