REIT Project

THE BRITISH LAND COMPANY Plc.
London Stock Exchange Sector: Financials Industry: REIT –Residential &amp. Commercial Stock Symbol: BLND. RECOMMENDATION: HOLD PRICE: 378 Gp AS OF July2, 2009 Volume 4,063,468 Days High 379.25p Days Low 371.50p Avg. Vol 5,343,894
Target: N/A
Market Cap: N/A
Dividend Yield: N/A
FFO per share N/A
July 2, 2009
Felix Salmon
Symbol: BLND
Company description: The British Land Company PLC operates in the fields of property development, finance and investment in London. The Company’s retail warehouse park investments include Teesside Shopping Park, Giltbrook Retail Park, The Kingston Centre, New Mersey Shopping Park, Glasgow Fort, Parkgate Shopping. Significant financial developments have occurred in the past two years that led to decrease of revenues to 16 percent to £554M and a net loss of £63l 93B up from £1.61B as of March 2009 according to report of Reuters. Based on Reuters report, BLC posted negative performance for the year ended as it has negative operating margin of -65.16 B and a negative net profit margin of -700.54bn. Percentage of management effectiveness are nestled on high negative ratios.. It has low cash availability and zero cash flow which shows company relies heavily on debt borrowings. It has a total debt equity ratio of 117.76% that is a risky investment because of high cost of money. The company has no dividend yield and zero growth rates for the past two years
There is no available property map that depicts location of properties of BLC. Based on Yahoo Finance, BLC is the biggest real estate management company in London. One of their properties is over 12 hectares property in Broadgate Complex which houses offices, stores, hotel rooms and a large shopping mall. It has also numerous sites acquired thru joint ventures like The Meadowhall BLC and The Pillar Property that is made up of shopping centers. (Yahoo Finance)
Investment Thesis. In the face of challenges of REIT companies due to slowing economy and global financial crisis, is Brit Land Co. affected in terms of growth ratios, performance and return on investment. Buy/Hold Recommendation. I will recommend hold buying for the shares of stock in Brit Land Co., until such time that they have corrected the profitability of the company. Company has been affected by economic crisis which started in mortgage and realty industry. The slow down on property market have affected the financial performance of the company resulting to the loss of confidence of stock holders.
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Annexes
Financial Ratios Brit Land Co. Plc.
Top of Form
Market Capitalisation
Market Cap (£&nbsp.Millions)
3,315.03
Shares Outstanding
852.19
Float
851.20
Per Share Data (£ &nbsp. GBP)
Earnin
-6.17
Sales
0.88
Book Value
3.77
Cash Flow

Cash
0.74
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Valuation Ratios
Price/Earnings

Price/Sales
5.98
Price/Book
1.03
Price/Cash Flow

Management Effectiveness (%)
Return on Equity
-77.63
Return on Assets
-38.38
Return on Investment
-40.67
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Profitability Ratios (%)
Gross Margin

Operating Margin
-65.16
Net Profit Margin
-700.54
Dividend Information
Dividend Yield (%)

Dividend Per Share (£ &nbsp. GBP)
0.30
Payout Ratio

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Financial Strength
Quick Ratio
1.29
Current Ratio
1.29
LT Debt/Equity
116.24
Total Debt/Equity
117.76
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Source: Reuters Financial ratios
Works Cited
Business Week. “Historical stock quote”. British Land Company, Plc. On line July 1, 2009 http://investing.businessweek.com/re search/stocks/snapshot/snapshot.asp?ric=BLND.
Reuters. ”Financial Highlights” British Land Company, Plc. On Line July 1, 2009 http://in.reuters.com/money/quotes/ratios?symbol=BLND.L
Yahoo Finance. ”Company profile” British Land Company, Plc. On line July 1, 2009 http://uk.finance.yahoo.com/q?s=BLND.L
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