Intu Warns on Going Bust Following a £2 Billion Loss

Intu Properties (LON:INTU) warns about the possibility of going bust if the shopping centre owner doesn’t manage to secure further funds.

Intu’s shares plunged 16% today following the company’s report of a £2.02bn loss for the year, even bigger than the £1.7bn loss from last year, as the company’s property revaluation loss increased. The assessed value of Intu-owned shopping centres plummeted 22% to £6.6bn.

Intu Properties, which owns such shopping malls as Manchester’s Trafford Centre and Lakeside, had to give up the scheduled £1bn equity raise at the beginning of March, while abandoning all efforts to secure between £1-1.5 billion because of market instability.

The landlord cited “material uncertainty in relation to Intu’s ability to continue as a going concern”. Still, Intu said there still are options, such as disposing of more assets, refinancing its £4.5bn debt, and convening meetings with investors.

Intu saw damage as its shopping centres operate in tough retail conditions. Rental income dropped 9.1% on a like-for-like basis, most of it due to retailer restructurings and management actions.

The London-based shopping centre owner estimates like-for-like rental income to decline even more this year, but by a lower margin than last year.

Roberts became Intu’s Chief Executive in April 2019 and has submitted a five-year plan since.

The company also said it is paying close attention to the impact of the coronavirus on its shopping malls, however, the number of buyers has hardly changed over the first 10 weeks of 2020.