StockMarketWire.com - Shared office space group Workspace hiked its annual dividend by 10% after a boost in rental income underpinned a rise in adjusted profit. The company declared a total dividend for the year through March of 36.16p per share, up from 32.87p on-year, including a final dividend of 24.49p. Pre-tax profit almost halved to £72.5m, down from £137.3m), owing to a 0.3% reduction in underlying property valuation compared to a £61m increase in the prior year. Trading profit after interest rose 12% to £81.0m driven by a 10% increase in net rental income to £122.0m. Workspace said it had experienced a significant slowdown in enquiries from the end of March, due to the Covid-19 crisis. Around 75% of customers by rent were receiving a 50% rent reduction offer until end of June, as well as rent deferrals on a case-by-case basis. Overall cash collection, net of discounts and deferrals, was running at about 70% in the quarter. Chief executive Graham Clemett said the company had a strong balance sheet, prudent funding liquidity and substantial headroom on its covenants, giving it a basis to increase its dividend. 'Looking forward, we will undoubtedly see subdued levels of operational performance in the short term with a reduction in rental income,' he said. 'However, we expect that the structural shift in the office market towards flexibility will now accelerate more broadly.' 'We believe that, with our well established flexible offer and the quality of our space and services, Workspace is ideally positioned to benefit as London recovers from the impact of the Covid-19 pandemic.'

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