Intu to determine future ‘in the coming weeks’

The Trafford Centre owner plans to devise a strategy for the ailing company in the weeks ahead after reporting a £2bn loss in its annual results on Thursday.

In the meantime, it is “business as usual” for the firm’s regional shopping centres, which also include the Manchester Arndale Centre, a spokesperson for Intu told Place North West.

“[Intu] is engaging with stakeholders in the coming weeks to determine the best way forward”, the spokesperson said, after the company said it almost doubled its losses in the year to 31 December 2019.

Intu has previously said it is exploring options to fix its balance sheet and pay down £4.5bn in debt, including the possible disposal or part-disposal of some of its assets, including in the UK and Spain.

However, the spokesperson said “there will be no immediate sale of assets. Any disposal will be done in an orderly way to maximise value for stakeholders.

“There is no guidance on timing of any potential part sale or disposals of centres. Intu has said that this is one of a number of options it has to raise liquidity and has received a number of proposals from investors interested in investing in its assets.”

Asked about the potential impact on Intu’s North West assets including the Trafford Centre and Manchester Arndale, which it co-owns with M&G Real Estate, the spokesperson said “it’s business as usual”.

Last week, Intu was forced to abandon its £1bn equity raise last week due to lack of interest among shareholders and prospective investors.

Yesterday, Intu attributed the financial loss, which equated to an additional £848m over the 12 months to 31 December, predominantly to a revaluation of its property portfolio that resulted in a deficit of £1.9bn.

The spokesperson said the loss was “driven by continued negative investor sentiment towards retail and retail real estate. Property valuations are disconnected from the operational performance of the business, which remains robust in a challenging market.”

Since the beginning of 2019, Intu has disposed of £600m of assets, the spokesperson added, which has been used to help pay down some of the company’s debt.

Intu reported a 6% drop in revenues to £542m for the full-year 2019, attributed to retail store closures and administrations.

In a statement to Place North West following publication of the latest financial results, Intu chief executive Matthew Roberts said: “Fixing Intu’s balance sheet is our number one strategic priority. We are currently engaged with our lenders and other stakeholders to discuss a range of options available to provide further liquidity for the business.

“We have immediately available cash and facilities of £200m and are not in breach of any debt covenants.

“We have the best portfolio of shopping centre assets across the UK and have reported a strong operational performance despite a challenging market. I remain confident in the future of our business and our ability to face these challenging conditions head on.”