Commercial Property News

Punch Taverns, Britain's largest pub company, announced full year results with turnover  down 3.4% in the leased pubs and 3.3% in the managed pubs, in line with management’s expectations.
 
The firm says that it intends to retain cash and strengthen the balance sheet as a priority ahead of paying a final dividend.

 It also confirmed that HMRC had approved a revised structure for the business which would enable it to convert to REIT status, though there is no indication that it will do this in the near future because of the costs of the required reorganisation.

Explaining the dividend decision, the company said that it wanted to keep the cash to repay some of its heavy borrowings early to shore up its balance sheet. Although repayment of the company's convertible bonds is not due until December 2010, Giles Thorley, chief executive, said that the credit squeeze made it uncertain whether it would be able to refinance them at that stage. He added that the company also wanted to conserve cash to invest in its pub estate.

As sales suffer, pub groups are having to provide more support to licensees, Punch  said that it's rent concessions had increased to £6 million.