Last checked at 7 Apr 2010 07:00
Date: 7 April 2010
On behalf of: First Property Group plc ("First Property" or the "Group")
Embargoed for: 0700hrs
First Property Group plc
Trading Update
First Property Group plc (AIM: FPO), the AIM-listed property fund management group, today issues a trading update for the year ended 31 March 2010.
When the Group issued a trading statement a year ago we drew attention to the fact that the Polish Zloty had weakened against the Euro and that 2009 was likely to be the year in which the credit crunch tested our asset management skills and the robustness of our portfolio of properties under management and those owned by the Group. I am pleased to report that we have come through 2009 in very good shape and it would appear that the worst of the credit crunch is now behind us. Poland, where 90% of our assets under management are located, avoided going into recession last year, making it the only EU member country to have done so.
It is also important to note that the value of our portfolio under management increased in value for the three months from 31 December 2009 to 31 March 2010 by 1%. We believe that we are at or very close to the bottom of the cycle for Polish income producing commercial property and we expect both values and rental income to increase during the forthcoming year.
As announced on 8 February 2010, we have secured a new mandate to invest £106 million in UK commercial property. We have made a good start to fulfilling that mandate and have thus far acquired two properties with a value of some £10 million and have a further three under offer, with a total value of £16.5 million.
As we continue to invest this new UK mandate, and other joint venture transactions we might undertake during the year, together with the expected recovery in asset values in Poland, we expect that our asset management fee income will begin to grow again in the year ahead.
At First Property Services Limited, the facilities maintenance subsidiary in which the Group owns a 60% interest, earnings have decreased, following the sharp reduction in activities of that subsidiary's clients. However it remained profitable and we expect it to remain so in the current year.
The Group's directors expect to report profit before tax for the year to 31 March 2010 in line with market expectations and will issue its preliminary results for that year in early June.
Ben Habib, Chief Executive of First Property Group plc, said:
"Once again the Group has ended the financial year in stronger shape than it began it, which is a strong performance in an environment where so many property companies have suffered. Assets under management within First Property Asset Management (FPAM), our core business, remained broadly stable throughout what continued to be a difficult period, and we are now set to grow the value of our assets under management, both as a result of new purchases and the recovery in asset values.
"I look forward to the current financial year with confidence as we continue to build on our solid foundations."
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For further information please contact:
| First Property Group plc | Via Redleaf Communications |
| Ben Habib (Chief Executive) Jeremy Barkes (Director, FJB Capital Advisers) | www.fprop.com Tel: 020 7731 2844 |
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| Arden Partners | Tel: 020 7614 5900 |
| Chris Hardie (Director Corporate Finance ) |
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| Redleaf Communications | Tel: 020 7566 6700 |
| Adam Leviton/Lucy Salaman | firstproperty@redleafpr.com |
Notes to editors:
About First Property Group plc
§First Property Group plc was established in March 2000 by Chief Executive Ben Habib and listed its shares on the Alternative Investment Market (AIM) in December 2000.
§First Property Group plc is a property services group which provides the following core services:
- Property Fund Management - provided by wholly owned subsidiary, First Property Asset Management Ltd (FPAM), with operations in the United Kingdom (UK) and Central & Eastern Europe (CEE). The performance of its funds under management in the CEE region are ranked #1 over the period 2006-2008 inclusive, as measured against IPD CEE Benchmark.
- Property Trading - provided by FPAM.
- Facilities Management - via its 60% stake in First Property Services Ltd, an Electrical & Mechanical installation and maintenance contractor.
§Further information about the Company and its products can be found at: www.fprop.com