LONDON (Alliance News) - Arricano Real Estate PLC Friday said it swung to a pretax profit in the first-half of the year, boosted by higher revaluation gains for its properties.
The Ukraine-focused retail real estate operator posted a pretax profit of USD15.2 million for the six months to June 30, compared with a USD3.4 million loss in the first-half of 2013, after realising a USD44.7 million gain on revaluation of its investment properties, compared with a USD1.7 million loss a year earlier.
Underlying pretax profit, which excludes benefits from revaluation of the portfolio, stood at USD5.4 million, compared with USD1.6 million a year earlier.
Revenue declined to USD11.4 million, from USD12.1 million, hit by tougher market conditions and a fall in occupancy rate levels.
The company said the current political and economic situation in Ukraine led to the significant devaluation of Hryvnia, which also hit results, as did significantly higher finance costs.
"Given the political changes that have taken place and continue to unfold in Ukraine, these results show a reassuring stability. Visitor numbers across our shopping centres have remained stable or increased slightly during the period and we have continued to collect rents from our retail tenants and progressed our new developments with Prospect in Kyiv due to open as planned later this month," said Rupert Cottrell in a statement.
As at June 30, total fair valuation of the company's portfolio was USD247.1 million, compared with USD287.8 million six months prior, largely due to the devaluation of the Hryvnia.
"We believe the business is well positioned to operate through the current environment and has the potential to be extremely well positioned for the longer term," Cottrell added.
Arricano Real Estate shares were untraded Friday afternoon at USD2.34 per share.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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