Brixton interims with positive undertones?

Brixton's interim results for the first quarter show some positive signs, but the industrial giant is still working hard on its "financial flexibility".

Lettings and vacancy rates remained broadly the same as in the second half of 2008, which could be read as representing a bottoming out of the declines in both. New lettings generated £1.5m of new annualised revenue in the period, which is still down of course on Q1 2008. Vacancies rose from 17.3%, but only to 17.4% quarter on quarter.

A couple of non-west London disposals realised around £7m cash, but the company continues to work to restructure it's financial situation. With significant debt faling due this year, Brixton needs more cash to avoid any possible covenant breach.

Chief Executive, Peter Dawson, said: "Brixton has a high quality portfolio in excellent locations from which it generates good income levels. It has significant opportunities to increase that income through the letting up of voids and to further improve its cash flow through the mitigation of empty rates. Although market conditions remain extremely challenging, we are confident in the quality of our
portfolio and the underlying strength and resilience of our business".
"We are progressing our options to provide the Group with the additional financial flexibility it requires to mitigate the risk of breaching our balance sheet covenants. Our efforts are
focused on the initiatives outlined in the 2008 Preliminary Results, including asset disposals, debt refinancing and a potential equity raising, with the aim of reaching a comprehensive
long term solution for all stakeholders".
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