Pochin’s sees property values fall £6.7m

Cheshire-based developer Pochin's will write down the value of its portfolio by £6.7m following an independent valuation by Knight Frank, the first in three years.

Pochin's said the fall in values was partly offset by an excess over book value of £3.4m in the value of certain land assets.

"However," Pochin's said in a statement to the stockmarket. "As these are held as inventory items, this increase in value cannot be reflected in the accounts."

The group continues to dispose of its stakes in joint ventures and recently sold its property in Keele Park Developments, "and has discharged its associated guarantee obligations at a cost in line with the previously taken provision of £1.2m."

Pochin's said: "This leaves only one remaining significant joint venture of value on the group balance sheet. The valuation exercise referred to above indicates an impairment of value which, if adopted, would result in a fall of £1.5m in the carrying value of the group's interest in the joint venture."

Following the statement to the London Stock Exchange, John Moss, chief executive of Pochin's, said: "In advance of the completion of the company's annual report and accounts, we took the decision to commission Knight Frank to undertake an external valuation of our assets. The last few years have been a challenging time across both the construction and property sectors, and we are proud that Pochin's has continued to maintain its strong market position and has consistently delivered high quality work for our clients. Now that positive economic figures are starting to emerge, this is the right time to be reflective and take stock, in order to ensure that we are ideally placed to capitalise on any upturn."

Shares in Pochin's opened down 2p at 31.5p, valuing the company at £6.55m.

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