Plaza Centres register slight downturn in half-yearly profits

Shopping mall operators Plaza Centres pls has registered a half-yearly pre-tax profit of €625,275 for the period ended 30 June 2011 – a downturn from last year’s half-yearly €658,487.

Revenue for the period was €1,069,598 (2010: €1,001,509) an increase of 6.8%. Profit after tax amounted to €395,359 (2010:€416,539).

The company’s new extension in Bisazza Street, Sliema was inaugurated on 18 March 2011. The full benefit of the additional income streams is expected in the third and fourth quarters of the year, the company said.

Part of capital investment was funded through short term financing and operational cash flows, and therefore, improvement in net working capital is expected going forward. Notwithstanding the increase in rentable area of 1,700 s.m., occupancy for the period was 91% (2010: 92%) following completion of Extension III. Indications are that occupancy should increase during the fourth quarter of 2011.

Plaza Centres said the increase in expenditure is mainly attributable to marketing and sales promotion costs related to the new wing. The cost to income ratio for 2011 increased to 34.9% (2010: 30.3%), which ratio should improve once the additional income comes on stream.

In line with its growth plans, the company continues to look at new opportunities for expansion. Plaza Centres said its directors do not expect a significant change in the company’s performance in the next six months, although they remain attentive to external market factors.

The Board of Directors did not recommend the payment of an interim dividend.