CLS returns to year profit

11th Mar 2010 13:26

Property investment group CLS Holdings swung into the black in 2009 and increased net asset value by 19%, impressing analysts along the way.There was a profit before tax of £18.5m compared with a £142.1m loss the year before when numbers were hit by a £103m write-down on the value of property.Adjusted net asset value rose to 767.5p a share from 647.2p in 2008 and increased by 7% from 719.2p at 30 June.The value of the portfolio grew 6% in the second half to £813m, although that was only fractionally higher than the £799m year-on-year figure. A 7.5% increase in the underlying valuation for the UK offset a 5.6% decline in Europe."CLS has weathered the downturn impressively," says KBC Peel Hunt, managing to avoid raising equity, unlike many of its peers. Today it announced it is returning £6m to shareholders via a share buyback."The dominant c.60% family holding of chairman Sten Mortstedt continues to depress liquidity and price; however with a history of buybacks above market price and a discount to NAV of 40%, CLS is a strong Buy," says KBC.Last year's success revealed the defensive benefits of well-let properties, Mortstedt claimed Thursday."The fundamentals of our business remain sound. We have the resources available to take advantage of opportunities as they arise and I am delighted to report that we face the challenges ahead from a position of strength and confidence."