2024: A transformative year, repositioned to drive growth
Hammerson is the largest UK-listed, pure-play owner and manager of prime retail and leisure anchored city destinations across the UK, France and Ireland.
We own, manage and invest in landmark city destinations integrating retail, leisure and community hubs to meet evolving customer and occupier needs while delivering sustainable long-term growth for our stakeholders. Our 10 city locations rank in the top 20 of all retail venues across our geographies and in the top 1% where retail spend is concentrated. Our catchment reach of 40 million people attracts 170 million visitors per annum, generating £3 billion of sales for our brand partners.
Rita-Rose Gagné, Chief Executive of Hammerson, commented:
“Following a transformative and successful year for Hammerson, we enter 2025 as a repositioned business. In landing the pivotal sale of Value Retail and completing our non-core disposals, we have generated £1.5bn of cash proceeds over the last four years, materially strengthening our capital structure, and enabling investment for growth in our high-quality portfolio.
We have strategically realigned the business to benefit from structural market trends. First, cities are engines of economic growth, and we have concentrated our portfolio on exceptional assets in some of Europe’s fastest growing and most vibrant cities. Second, the flight to quality where occupiers want fewer and more productive stores in only these locations, enables us to attract leading global and local brand partners. Third, the physical experience has become more relevant for consumers and our brand partners, with at least 80% of all retail transactions touching a store.
Investment in our destinations and our unique and specialist platform provides data-driven insights to curate the right product, placemaking and mix of brands. This platform is scalable and agile, driving tangible benefits with higher occupancy, leasing, footfall and sales above national benchmarks, whilst growing our catchment and market share. There is more to come.
We are confident in our strategy and optimistic about the opportunity ahead for Hammerson. We continue to maintain a tight operational grip and are poised to deliver significant revenue and underlying earnings growth, with the full impact of our ongoing investments and acquisitions yet to be realised.”
Highlights
Another record year of leasing, 56% ahead previous passing rents and 13% over ERV
- Occupancy improved to over 95%, with few leasable units in most locations, driving rental tension across our portfolio
- 262 leases signed on 1m ft2 of space generating annual headline rent of £41m (£24m at share), another record performance on a like-for-like basis
- 956 principal leases secured since FY20, totalling £156m of annual rent at 100% at an average of 32% ahead of previous passing rent and 4% above ERV – c.50% of space let on new terms since FY20 and £1.1bn of rent contracted to first break. All geographies in positive reversion, with further opportunities ahead of us
- Occupier demand is robust with £8.6m of headline income already exchanged in 2025, 10% above previous passing rent and 11% ahead of ERV – good visibility and a strong pipeline for the remainder of 2025, underpinning our confidence in the outlook
Our destinations are thriving with footfall and sales ahead of national benchmarks
- Black Friday, Christmas Eve and New Year’s Eve all saw year-on-year increases of 10-12% for all our flagship destinations – Westquay had 112,000 visitors on the Saturday of Black Friday weekend, its highest number since November 2017
- We had good footfall momentum in the final quarter, reflecting new openings and seasonal events, with UK footfall up 17% quarter-on-quarter, Ireland 16% and France 5%
- We hosted 170m visitors at our destinations (+600k). Excluding assets in repositioning, footfall was up 2% (+2.5m) year-on-year across the Group1, with the UK up 2%, France up 4% and Ireland up 1%. All ahead of national benchmarks
- Sales up 5%1,2 in the UK and 3% in France, with brand partners benefiting from our combined investments, new concepts and upsized stores
- Anchor brand partners consistently report that their new store formats trade in the top five sales performers across their UK and European portfolios
Investment and capital recycling to drive future growth and value creation
- Investment in Bullring and Dundrum generated £184m of rent contracted to first break (including £87m in 2024), and a total of more than £250m since FY20 benefiting from halo effect of repositioning
- The repositioning of Cabot Circus and The Oracle in 2024 has already secured £52m of rent contracted to first break. Our investments will see marquee openings in 2025 such as M&S and Odeon at Cabot Circus, and Hollywood Bowl and TK Maxx at The Oracle
- Total property returns were +2.1%, with flagship destinations +2.9%
- Valuations increasingly reflecting successful investment with the UK up 4.2% and France up 1.5%, driven by higher contracted rental income, related ERV growth and some yield compression. Valuations in Ireland were down 13% due to outward yield shift, although yields stabilised in Q4
- Having crystallised €705m (£595m) of cash proceeds from Value Retail in September at an exit yield of 3.4%, we rapidly recycled £135m to gain 100% control of Westquay at a significantly more attractive yield – we continue to see opportunities for JV consolidation and several discussions are ongoing
Our relentless focus on efficiency and investment in data has delivered a further 16% cost reduction
- Gross administration costs down 16% year-on-year, ahead of guidance of 10%; a total reduction of 36% since FY20
- Our investments in data and analytics enable us to better understand our catchments and to continually evolve and curate our estates to meet changing consumer and occupier needs to maximise the value of our physical and media assets. We are accelerating the roll out of AI tools in 2025
- Today, we have a specialist, data-driven and efficient platform that is scalable and delivering operational gearing as we grow rental income and AUM
FY24 financial summary
- Reported like-for-like GRI up 1.6% year-on-year; reported like-for-like NRI -0.5% reflecting ongoing extensive repositioning in the UK
- Underlying1 like for like GRI +3.0%, with up to 7% growth from assets benefitting from recent investments, underlying like-for-like NRI +0.2%
- Adjusted earnings of £99m (FY23: £116m), reflecting impact of disposals. Adjusted EPS 19.9p (FY23: 23.4p)
- IFRS loss of £526m (FY23: (£51m loss), reflecting £497m Value Retail impairment and H124 revaluation loss
- One of the strongest balance sheets in the sector, with net debt down 40% year-on-year to £799m. Resulting Net debt:EBITDA of 5.8x (FY23: 8.0x) and LTV of 30% (FY23: 34%), reflected in credit improvements from Moody’s and Fitch in the second half
- Closing portfolio value of £2.7bn, AUM £4bn. EPRA NTA per share 370p (HY24: 382p)
Dividend
- Recommended final dividend of 8.07p per share for 2024 in line with the Board’s new policy of 80-85% of Adjusted earnings. The full year dividend is 15.63p, up 4%. The dividend recommendation will be released as a separate announcement