- British Land Group said Wednesday it swung to a first-half loss as net rental income dropped amid a challenging retail market.

For the six months ended 30 September, the company reported a loss of £42m from a profit £238 a year earlier, and earnings -- stated as EPRA net asset value per share -- fell 2.9% to 939p.

Underlying pre-tax profit fell fell 14.6% to £169m.

Net rental income fell by £30m to £267m during the first half, driven largely by a surrender premia received in the prior period and the impact of asset sales over the last 18 months, through this was offset by robust growth within offices from strong leasing activity.

The portfolio value was down 1.9% overall, owing to a 4.5% drop in retail valuations. Occupancy increased marginally over the half to 97.8%, and the weighted average lease length fell to 6.9 years.

Disposals continue, with £139m of assets sold in the period at an average premium to book value of 7%.

The company declared an interim dividend of 15.5p, up 3% on last year. 'In a particularly challenging retail market, we remained focused on delivering operationally day-to-day while at the same time progressing our strategy and refining our portfolio. With £634m of retail assets sold or under offer in the last 12 months, we have sold a total of £2.8bn since April 2014,' said Chris Grigg, Chief Executive.

'We expect retail to remain challenging in both the occupier and investment markets as the impact of long-term structural change is compounded by short-term headwinds.' Story provided by