British Land : Full Year Results 2015/16

Chris Grigg, Chief Executive said: 'We have delivered another strong set of results with performance underpinned by strengthening rental growth across our business. We are focusing the business around long term trends and continue to see the benefits of the investments we have made in recent years. While we are mindful of the impact of market uncertainty, our high quality portfolio, flexible development pipeline and robust financial position continue to mean that our business is both resilient and well placed for the long term.'

Strong full year results

• Total accounting return of 14.2% (2014/15: 24.5%)
• Underlying Profit +16.0% to £363 million; IFRS PBT of £1,331 million (2014/15 £1,789 million) reflecting valuation uplift of £950 million (2014/15 £1,582 million)
• EPRA NAV +10.9% to 919 pence (932p pre Budget stamp duty increase); IFRS Net Assets at £9.6 billion (2014/15 £8.6 billion)
• Final quarterly dividend of 7.09 pence (+2.5%); bringing the full year to 28.36 pence (+2.5%)
• Full year dividend of 29.20 pence per share proposed for 2016/17, +3.0%; first quarter 7.30 pence

Valuation performance driven by improving ERV growth

• Total portfolio valuation +6.7%; standing investments +6.4%; developments +9.4%; H2 performance driven by ERV growth with an accelerating trend compared to H1 and FY15
• Strong uplift in Offices & Residential +11.8%; good performance in Retail & Leisure +2.4%
• ERV growth of 5.3% outperforming IPD by 130 bps; 9.6% in Offices and 2.4% in Retail; Multi-let Retail ERV growth of 3.4%

Placemaking skills delivering leasing success; portfolio nearly fully let

• 1.3 million sq ft of lettings and renewals across the portfolio; occupancy now 99%
• Retail occupiers attracted to our multi-let assets benefiting from placemaking activity; 903,000 sq ft Retail lettings and renewals; 8.0% ahead of ERV; 343,000 sq ft under offer
• Footfall +3.0%, outperforming the benchmark by 440bps; retailer sales +2.4%
• 296,000 sq ft of Office lettings and renewals; 5.6% ahead of ERV; The Leadenhall Building, 98% let or under offer (2014/15 84%); £3.8 million of rent added through rent reviews +17% vs previous rents

Allocating capital into our London campuses and multi-let Retail assets

• Net investment of £280 million into our London campuses; acquisition of One Sheldon Square, development of 4 Kingdom Street and public realm works at Paddington Central; completion of 5 Broadgate development; completion of 338 Euston Road refurbishment at Regent's Place
• Focus on multi-let Retail portfolio; 169,000 sq ft of leisure extensions completed at Whiteley and Glasgow Fort; £420 million of mature or non-core Retail asset disposals, including £122 million of superstores

Modest committed development, but a significant pipeline with optionality

• Committed speculative development of £530 million; 2.0 million sq ft near term pipeline
• Progressing the Broadgate vision; planning granted on 100 Liverpool Street and 1 Finsbury Avenue for 823,000 sq ft of redevelopment. Planning submitted at 2-3 Finsbury Avenue for 550,000 sq ft
• 168,000 sq ft of leisure extensions consented at Drake Circus Shopping Centre, Plymouth and New Mersey Shopping Park, Speke
• Roger Madelin joined as Canada Water Project Head in February; aim to submit outline planning application in 2017

Robust financial position with continued access to low cost finance

• Proportionately consolidated LTV reduced to 32%; 29% pro-forma for 2012 Convertible Bond
• Proportionately consolidated WAIR reduced by 50 bps to 3.3%; driven by increased proportion of floating rate debt, £350 million zero coupon convertible, tender offer and purchase of £110 million of debentures

Forward-Looking Statements

This Press Release contains certain 'forward-looking' statements. Such statements reflect current views on, among other things, our markets, activities, projections, objectives and prospects. Such 'forward-looking' statements can sometimes, but not always, be identified by their reference to a date or point in the future or the use of 'forward-looking' terminology, including terms such as 'believes', 'estimates', 'anticipates', 'expects', 'forecasts', 'intends', 'due', 'plans', 'projects', 'goal', 'outlook', 'schedule', 'target', 'aim', 'may', 'likely to', 'will', 'would', 'could', 'should' or similar expressions or in each case their negative or other variations or comparable terminology. By their nature, forward-looking statements involve inherent risks, assumptions and uncertainties because they relate to future events and depend on circumstances which may or may not occur and may be beyond our ability to control or predict. Forward-looking statements should be regarded with caution as actual results may differ materially from those expressed in or implied by such statements.

Important factors that could cause actual results, performance or achievements of British Land to differ materially from any outcomes or results expressed or implied by such forward-looking statements include, among other things: (a) general business and political, social and economic conditions globally, (b) the outcome and consequences of the referendum on Britain leaving the EU, (c) industry and market trends (including demand in the property investment market and property price volatility), (d) competition, (e) the behaviour of other market participants, (f) changes in government and other regulation, including in relation to the environment, health and safety and taxation (in particular, in respect of British Land's status as a Real Estate Investment Trust), (g) inflation and consumer confidence, (h) labour relations and work stoppages, (i) natural disasters and adverse weather conditions, (j) terrorism and acts of war, (k) British Land's overall business strategy, risk appetite and investment choices in its portfolio management, (l) legal or other proceedings against or affecting British Land, (m) reliable and secure IT infrastructure, (n) changes in occupier demand and tenant default, (o) changes in financial and equity markets including interest and exchange rate fluctuations, (p) changes in accounting practices and the interpretation of accounting standards and (q) the availability and cost of finance. The Company's principal risks are described in greater detail in the section of this Press Release headed Managing risk in delivering our strategy. Forward-looking statements in this Press Release, or the British Land website or made subsequently, which are attributable to British Land or persons acting on its behalf should therefore be construed in light of all such factors.

Information contained in this Press Release relating to British Land or its share price or the yield on its shares are not guarantees of, and should not be relied upon as an indicator of, future performance, and nothing in this Press Release should be construed as a profit forecast. Any forward-looking statements made by or on behalf of British Land speak only as of the date they are made. Such forward-looking statements are expressly qualified in their entirety by the factors referred to above and no representation, assurance, guarantee or warranty is given in relation to them (whether by British Land or any of its associates, directors, officers, employees or advisers), including as to their completeness, accuracy or the basis on which they were prepared.

Other than in accordance with our legal and regulatory obligations (including under the UK Financial Conduct Authority's Listing Rules and Disclosure Rules and Transparency Rules), British Land does not intend or undertake to update or revise forward-looking statements to reflect any changes in British Land's expectations with regard thereto or any changes in information, events, conditions or circumstances on which any such statement is based. This document shall not, under any circumstances, create any implication that there has been no change in the business or affairs of British Land since the date of this document or that the information contained herein is correct as at any time subsequent to this date.

Presentation of financial information

The Group financial statements are prepared under IFRS where the Group's interests in joint ventures and funds are shown as a single line item on the income statement and balance sheet and all subsidiaries are consolidated at 100%.

Management considers the business principally on a proportionally consolidated basis when setting the strategy, determining annual priorities, making investment and financing decisions and reviewing performance. This includes the Group's share of joint ventures and funds on a line-by-line basis and excludes non-controlling interests in the Group's subsidiaries. The financial key performance indicators are also presented on this basis. Refer to the Financial Review for a discussion of the IFRS results.

Notes to Editors:

About British Land

We are one of Europe's largest publicly listed real estate companies. We own, manage, develop and finance a portfolio of high quality commercial property, focused on retail locations around the UK and London offices. We have total assets in the UK, owned or managed, of £20.0 billion (of which British Land share is £14.6 billion) as valued at 31 March 2016. Our properties are home to over 1,200 different organisations ranging from international brands to local start-ups. Our objective is to deliver long term and sustainable total returns to our shareholders and we do this by focusing on Places People Prefer. People have a choice where they work, shop and live and we aim to create outstanding places which make a positive difference to people's everyday lives. Our customer orientation enables us to develop a deep understanding of the people who use our places. We employ a lean team of experts, who have the skills to translate this understanding into creating the right places, and we have an efficient capital structure which is able to finance these places effectively.

Retail assets account for 50% of our portfolio. As the UK's largest listed owner and manager of retail space, our portfolio is well matched to the different ways people shop today. We are focused on being the destination of choice for retailers and their customers by being the best provider of spaces and services. Comprising over 20 million sq ft of retail space across multi-lets, superstores, department stores and leisure assets, the retail portfolio is modern, flexible and adaptable to a wide range of formats.

Our Office and Residential portfolio, which accounts for 48% of our portfolio, is focused on London. We have an attractive mix of high quality buildings in well managed environments and a pipeline of development projects which will add significantly to our portfolio. Increasingly, our Offices are in mixed-use environments which include retail and residential elements. Our 7.5 million sq ft of high quality office space includes Regent's Place and Paddington Central in the West End and Broadgate, the premier City office campus (50% share).

The remaining 2% of our portfolio is at Canada Water where we have a 46 acre redevelopment opportunity in our medium term pipeline. Our industry-leading sustainability strategy is a powerful tool to deliver lasting value for all our stakeholders. By supporting communities, improving environments and growing economies, we create Places People Prefer and enhance long term returns.

Further details can be found on the British Land website at www.britishland.com

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