Intu boss David Fischel : The UK is way out of line with its international peers on business rates

 
Shruti Tripathi Chopra
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Intu owns the Trafford Centre in Manchester (Source: Getty)

Intu ruled the FTSE 100 roost this morning after the shopping centre giant increased its dividend, despite reporting a fall in profits.

The retail property group's profits dropped more than 60 per cent but its dividend was up two per cent, at 14p per share.

Revenues grew four per cent to £594.3m, from £571.6m the year before.

While net rental income rose 4.4 per cent from £428m to £447m, underlying earnings were up seven per cent, from £187m to £200m.

Read more: Retail sales bounce back as consumer spending continues to support growth

David Fischel, Intu's chief executive, warned against the upcoming rise in business rates in April.

Recent research by Intu and industry body Revo found business rates could cost Britain around 40,000 new retail jobs over the next five years.

"The UK is way out of line with its international peers on business rates," Fischel told City A.M.

"We did research with 130 international retailers looking to invest in the UK and the overwhelming finding was that business rates were a far bigger disincentive to come to the UK than Brexit was."

Read more: Retail sales bounce back as consumer spending continues to support growth

Fischel called on the government to make a concrete plan to ensure businesses aren't penalised because of the business rates revaluation, due to come into effect on 1 April.

"There should be a concerted effort on the part of government over the next 25 years to get business rates down to a number that is competitive with other countries," he said.

Read more: Retail group urges government to reduce the burden of business rates

However, the Intu boss added the impact of business rates on his firm will be "pretty neutral".

"We're spread out across the whole country and have had our ups and downs but overall, we expect to see no real material change.

"Last year, our retailers paid about £290m or one per cent of the UK's business rates bill. We estimate that would be pretty much the same," he added.

Speaking about the impact of BHS' collapse on Intu, Fischel said: "We had about 10 BHS units and for us [the collapse] is a short-term pain but long-term gain. Next have already taken a store and we're very close to a deal with a couple of others. I'd be surprised if by the end of the year all those 10 units haven't gone."

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