Financial Statements
12 Funds and Joint Ventures
British Land's summary share of profits of funds and joint ventures
| 2006 £m |
2005 £m |
|
|---|---|---|
| Gross rental income | 123 | 73 |
| Net rental income | 112 | 68 |
| Other income and expenditure | (6) | (3) |
| Net financing costs | (67) | (34) |
| Net underlying profit before tax | 39 | 31 |
| Net valuation gains on property and investments | 378 | 169 |
| Profit on ordinary activities before taxation | 417 | 200 |
| Current tax | (9) | (10) |
| Deferred tax | (97) | (32) |
| Profit on ordinary activities after taxation | 311 | 158 |
Summary movement for the year of the investments in funds and joint ventures
| Equity £m |
Loans £m |
Total £m |
||
|---|---|---|---|---|
| At 1 April 2005 | 660 | 40 | 700 | |
| Acquired with Pillar Property PLC | 594 | 5 | 599 | |
| Additions | 1 | 11 | 12 | |
| Disposals | (50) | (38) | (88) | |
| Share of profit after taxation | 311 | 311 | ||
| Distributions and dividends: capital | (277) | (277) | ||
| revenue | (25) | (25) | ||
| Hedging movements | 2 | 2 | ||
| At 31 March 2006 | 1,216 | 18 | 1,234 |
At 31 March 2006, the total investment in funds and joint ventures of £1,234m comprises £599m of investment in funds being Hercules Unit
Trust (HUT), Hercules Income Fund (HIF) and Pillar Retail Europark Fund (PREF) and £635m investment in joint ventures, being the total of
£589m and City of London Office Unit Trust (CLOUT) of £46m. At 31 March 2005, there were no investments in funds.
Distributions in the year include £65m (£59m capital) received from HUT; £31m (£28m capital) received from CLOUT and £190m received
from The Scottish Retail Property Limited Partnership.
With regard to funds and joint ventures, at 31 March 2006 the Group's share of:
(i)their properties, including finance and trading lease surpluses is £2,661m (2005: £1,353m).
(ii)their external net debt is £1,124m (2005: £502m).
(iii)the market value of their debt was £2m more than the Group's share of the book value (2005: £4m).
All fund and joint venture results have been shown for the period ended 31 March 2006. In the case of some joint ventures this period exceeds 12 months as the Group has aligned all period ends as a consequence of moving to quarterly reporting. The effect is not considered material to the current and prior year financial statements.
| Funds' summary financial statements | |||||
| All disclosures have been restated to British Land accounting policies under IFRS including deferred tax and excluding performance and management fees due to the Group. | Hercules Unit Trust |
Hercules Income Fund |
Pillar Retail Europark Fund |
City of London Office Unit Trust |
British Land Share |
|---|---|---|---|---|---|
| Percentage interest | 34.64% | 26.12% | 34.16% | 35.94% | |
| Date established | 22 September 2000 |
16 September 2004 |
17 March 2004 |
6 November 2000 |
| Accounting period | 8 months ended 31 March 2006 |
8 months ended 31 March 2006 |
5 months ended 31 December 2005 |
8 months ended 31 March 2006 |
|
|---|---|---|---|---|---|
| Summarised profit and loss accounts | £m | £m | £m | £m | £m |
| Gross rental income | 70 | 6 | 6 | 20 | 35 |
| Net rent and related income | 68 | 5 | 5 | 19 | 34 |
| Other income and expenditure | (3) | (1) | (1) | (2) | |
| Operating profit | 65 | 5 | 4 | 18 | 32 |
| Surplus (deficit) on revaluation | 445 | 22 | 8 | 15 | 169 |
| Disposal of fixed assets | 2 | 1 | 13 | 6 | |
| Net external interest payable | (42) | (2) | (12) | (20) | |
| Profit (loss) before tax | 470 | 28 | 10 | 34 | 187 |
| Current tax | (7) | (1) | (1) | (1) | (4) |
| Deferred tax | (89) | (5) | (8) | (6) | (37) |
| Profit (loss) after tax | 374 | 22 | 1 | 27 | 146 |
| Summarised balance sheets | |||||
| Investment properties at valuation | 3,113 | 157 | 202 | 102 | 1,225 |
| Total properties | 3,113 | 157 | 202 | 102 | 1,225 |
| Current assets | 33 | 6 | 14 | 123 | 71 |
| Cash and deposits | 32 | 3 | 6 | 12 | 20 |
| Gross assets | 3,178 | 166 | 222 | 237 | 1,316 |
| Current liabilities | (44) | (5) | (10) | (71) | (54) |
| Bank debt falling due within one year | (25) | (7) | |||
| Bank debt falling due after one year | (298) | (117) | (38) | (156) | |
| Securitised debt | (957) | (332) | |||
| Deferred tax | (337) | (5) | (15) | (122) | |
| Gross liabilities | (1,636) | (35) | (142) | (109) | (671) |
| Net external assets | 1,542 | 131 | 80 | 128 | 645 |
| Represented by: |
|||||
| Investors’ capital | 1,542 | 131 | 80 | 128 | 645 |
| Total investment | 1,542 | 131 | 80 | 128 | 645 |
| Capital commitments | 42 | 14 |
| Joint ventures’ summary financial statements | |||||
| All disclosures have been restated to British Land accounting policies under IFRS | The Scottish Retail Property Limited Partnership |
BL Davidson Ltd | BLT Properties Ltd |
The Tesco British Land Property Partnership |
Tesco BL Holdings Ltd |
|---|---|---|---|---|---|
| All joint ventures are held equally on a 50:50 basis | |||||
| Partners | Land Securities Group PLC |
Manny Davidson, his family and trusts |
Tesco PLC | Tesco PLC | Tesco PLC |
| Date established | March 2004 |
September 2001 |
November 1996 |
February 1998 |
November 1999 |
| Accounting period | Year ended 31 March 2006 |
15 months ended 31 March 2006 |
15 months ended 31 March 2006 |
15 months ended 31 March 2006 |
15 months ended 31 March 2006 |
|---|---|---|---|---|---|
| Summarised profit and loss accounts | £m | £m | £m | £m | £m |
| Gross rent and related income | 50 | 41 | 19 | 12 | 34 |
| Net rent and related income | 34 | 39 | 18 | 11 | 33 |
| Other income and expenditure | (2) | (3) | (1) | (1) | |
| Profit (loss) on property trading | 1 | ||||
| Operating profit | 32 | 37 | 18 | 10 | 32 |
| Surplus (deficit) on revaluation | 41 | 99 | 61 | 28 | 128 |
| Disposal of fixed assets | (1) | ||||
| Net interest | |||||
| – External | (22) | (20) | (13) | (5) | (22) |
| – Shareholders | 1 | ||||
| Net interest (payable) receivable | (22) | (20) | (12) | (5) | (22) |
| Profit (loss) before tax | 51 | 115 | 67 | 33 | 138 |
| Current tax | (3) | (5) | (1) | 13 | (3) |
| Deferred tax | (29) | (28) | (18) | (8) | (36) |
| Profit (loss) after tax | 19 | 82 | 48 | 38 | 99 |
| Summarised balance sheets | |||||
| Investment properties at valuation | 665 | 698 | 344 | 181 | 630 |
| Development and trading properties at cost | 8 | ||||
| Assets held under finance leases | |||||
| Total properties | 665 | 706 | 344 | 181 | 630 |
| Current assets | 31 | 18 | 3 | 6 | 20 |
| Upstream loans to joint venture shareholders | 17 | ||||
| Cash and deposits | 16 | 16 | 12 | 5 | 18 |
| Gross assets | 712 | 740 | 376 | 192 | 668 |
| Current liabilities | (41) | (31) | (11) | (18) | (33) |
| Bank debt falling due within one year | (30) | ||||
| Bank debt falling due after one year | (83) | (185) | (87) | (315) | |
| Securitised debt | (427) | ||||
| Debentures | (114) | ||||
| Other non-current liabilities | (10) | (4) | |||
| Deferred tax | (69) | (115) | (48) | (17) | (80) |
| Gross liabilities | (547) | (377) | (244) | (122) | (428) |
| Net external assets | 165 | 363 | 132 | 70 | 240 |
| Represented by: | |||||
| Shareholder loans | |||||
| Ordinary shareholders’ funds/Partners’ capital | 165 | 363 | 132 | 70 | 240 |
| Total investment | 165 | 363 | 132 | 70 | 240 |
| Capital commitments | 32 | 17 | 1 |
| Joint ventures’ summary financial statements | ||||
| All disclosures have been restated to British Land accounting policies under IFRS |
BL Fraser Ltd | Other Joint Ventures | British Land Share |
British Land Share 2005 Comparative |
|---|---|---|---|---|
| All joint ventures are held equally on a 50:50 basis | ||||
| Partners | House of Fraser plc |
|||
| Date established | July 1999 | |||
| Accounting period | 14 months ended 31 March 2006 |
|||
|---|---|---|---|---|
| Summarised profit and loss accounts | £m | £m | £m | £m |
| Gross rent and related income | 16 | 3 | 88 | 73 |
| Net rent and related income | 16 | 5 | 78 | 68 |
| Other income and expenditure | (1) | (4) | (3) | |
| Profit (loss) on property trading | 17 | 9 | 3 | |
| Operating profit | 15 | 22 | 83 | 68 |
| Surplus (deficit) on revaluation | 26 | 5 | 194 | 160 |
| Disposal of fixed assets | 1 | 6 | ||
| Net interest | ||||
| – External | (10) | (4) | (48) | (31) |
| – Shareholders | 1 | 1 | (3) | |
| Net interest (payable) | (10) | (3) | (47) | (34) |
| Profit (loss) before tax | 32 | 24 | 230 | 200 |
| Current tax | (4) | (7) | (5) | (10) |
| Deferred tax | (1) | (60) | (32) | |
| Profit (loss) after tax | 28 | 16 | 165 | 158 |
| Summarised balance sheets | ||||
| Investment properties at valuation | 286 | 32 | 1,418 | 1,325 |
| Development and trading properties at cost | 4 | 25 | ||
| Assets held under finance leases | 14 | 7 | 8 | |
| Total properties | 286 | 46 | 1,429 | 1,358 |
| Current assets | 3 | 49 | 65 | 12 |
| Upstream loans to joint venture shareholders | 31 | 24 | 26 | |
| Cash and deposits | 7 | 20 | 47 | 56 |
| Gross assets | 296 | 146 | 1,565 | 1,452 |
| Current liabilities | (11) | (52) | (98) | (73) |
| Bank debt falling due within one year | (4) | (17) | (81) | |
| Bank debt falling due after one year | (130) | (2) | (401) | (412) |
| Securitised debt | (214) | |||
| Debentures | (57) | (57) | ||
| Other non-current liabilities | (2) | (8) | (11) | |
| Deferred tax | (29) | (4) | (181) | (118) |
| Gross liabilities | (176) | (58) | (976) | (752) |
| Net external assets | 120 | 88 | 589 | 700 |
| Represented by: | ||||
| Shareholder loans | 1 | 35 | 18 | 40 |
| Ordinary shareholders’ funds/Partners’ capital | 119 | 53 | 571 | 660 |
| Total investment | 120 | 88 | 589 | 700 |
| Capital commitments | 16 | 33 | 33 |