U&I loss widens as asset values plunge

U&I's annual loss widened as the urban regeneration company's asset values plunged because of Covid-19 and other causes of "market disruption".

The company reported an £86.7m loss for the year to the end of March compared with a £58.6m loss a year earlier and a net asset value of £202.9m, down from £289.6m.

The loss was caused mainly by development and trading asset losses of £39.1m for underperforming assets. The capital value of U&I's investment portfolio dropped 15.1% to 95.5m, mainly due to lower market confidence in retail assets and "the impact Covid-19".

Richard Upton, chief executive, said: "The operating environment during FY2021 was as challenging as we have ever experienced as the ongoing Covid-19 pandemic impacted planning decisions, delayed completions and lettings, and reduced asset values.

"We have made some clinical decisions in many areas of the business, resulting in further development and trading asset impairments. Covid-related market issues further added to us reporting hugely disappointing financial results today."

Upton, who took over 18 weeks ago, said U&I was too complex, difficult to understand and unclear on future strategy. The company sold £54.5m of assets in the past year and will sell more to concentrate on its core regeneration activities, he said.

U&I shares fell 4% to 87.32p at 10:40 BST.

The company also announced a board overhaul. Chairman Peter Williams will step down by the end of March 2022 and two non-executives, Nick Thomlinson and Barry Bennett, will leave in that period. Ros Kerslake, a director since 2017 will chair the remuneration committee and become the senior independent director after the annual general meeting in September 2021.

Williams said: "The proposed changes to U&I's board will complement the executive management changes that we announced at our interim results, supporting a more simplified and focused business."