Lend Lease full-year profit drops 47% on UK writedown

Monday 4th August 2008

Lend Lease Corp., the Australian property developer, said annual profit fell 47% after it wrote down the value of assets in the UK. It forecast earning swill drop again this year.

Profit was A$265.4 million in the 12 months ended June 30, from A$497.5 million a year earlier, the Sydney-based company said in a statement. It wrote down the carrying value of inventory at its UK Communities unit, Crosby Lend Lease, by A$121.5 million.

Lend Lease stock fell 10% to A$9.09 on the ASX, bringing its slide this year to 48%. The company today said it also reduced the value of properties by A$60.2 million.

Operating profit in the current year will probably fall 10% to 15%. Still, "given continuing volatility in global credit and property markets, it is difficult to give earnings guidance for FY09 with a high degree of confidence," the company said.

The company will pay a final dividend of 34 cents a share, keeping the full-year payment unchanged at 77 cents.

Lend Lease, which is also developing London's 2012 Olympic Village, said it is in an "exceptionally strong" financial position, with low gearing, strong positive cash flows and more than A$800 million in cash on hand.

The company said it will give a full trading update with its results on August 21.

By Jonathan Underhill

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