Rising interest costs reduce profits at Jermyn Investments

Pre-tax profits at Jermyn Investments fell to £543,000 from £622,000 for the six months to the end of June. An enlarged property portfolio helped the property company to report an increase in operating profits - to £949,000 from £472,000. But the pre-tax outcome was hit by a sharp increase in interest costs, up to £933,000 from £234,000, a currency translation loss of £142,000 and the £147,000 cost of its new Dublin Stock Exchange listing and amendment to its joint venture agreement. Shareholders are to get a dividend of 2.5p per share, up from 2.4p with an option to take new ordinary shares in lieu of dividends.

The British-based company, which has a strong presence in the Irish property market, got a listing on the Irish Stock Exchange in April. The company already had a listing in London.

Chairman, Mr Ray Horney said Jermyn's Irish investments performed well.

Jermyn's is involved in the Irish property market through its joint venture with Treaury Holdings, Castle Market Holdings (CMH). CMH bought a £46 million property portfolio from Irish Life in early 1995 and late last year bought the Stillorgan Shopping Centre for £45 million.

Jermyn plans to revalue its Irish investments at the end of the year and a number of rent reviews on its Irish properties are due in 1997 and 1998, Mr Horney said. The joint venture operation has submitted a planning application for the redevelopment of Stillorgan Shopping Centre and the extension of car parking facilities there.

While the high value of sterling will reverse some of Jermyn's previous gains on its Irish investments, Mr Horney said: "We consider our investment in Ireland as a long-term strategy and we have seen considerable valuation gains since our original investment."

Four Irish properties, all in Dublin, were sold during the period - Jefferson House in Donnybrook; Liffey House in Tara Street; and two industrial estate units. Since the end of the halfyear, Jermyn sold an industrial unit at the Airways Industrial Estate. The total raised from the sales was £9.5 million. All of the properties were acquired since 1995 and were sold "for prices considerably in excess of the valuation at acquisition".

Since the end of June, the company has acquired 16 properties from Friends Provident for £14.8 million. The acquisition was funded by debt and the issue of new shares.