CLS swings to loss as property values drop

The company, which owns workspaces in the UK, Germany and France, reported a pre-tax loss of £106.4m for the six months ended 30 June, compared to a profit of £21.3m the year before.

CLS shares were down 3.4% in early trading on Wednesday at 138.6p.

Chief executive Fredrik Widlund cited “challenging” macroeconomic conditions as the company was forced to take a hit of £132.9m in valuation declines from its portfolio (-7.1% year-on-year).

Net tangible assets per share fell 11.5% year-on-year to 291.6p, which it blamed on valuation declines and foreign exchange losses from a stronger sterling.

In local currencies, the value of CLS’s property portfolio declined by 8.1% in the UK, 3.3% in Germany and 1.9% in France.

Nevertheless, the company reported a net rental income for the first half of £55.6m, up 5.3% year-on-year, as it maintained its interim dividend at 2.6p.

"CLS remains focussed on executing operational and portfolio improvements, and our geographic diversity and high-quality properties continue to provide resilience and performance,” Widlund said. “Recent lettings are encouraging and demonstrate our ability to capture opportunities for our properties when they arise."