smh retail sales growth a fillip for centro

Has to be a first some positive news from the media on Centro.

They did mention some negative issues as well

"who have significant hurdles to overcome by Friday week to prevent the group's financiers from appointing receivers" lol

Carolyn Cummins
May 21, 2008

BELEAGUERED Centro Properties got a lift yesterday, reporting a 7 per cent rise in retail sales from its tenants to $10.5 billion for the March quarter.

The news was well received by investors, who pushed Centro stock up 3c to 39.5c.

According to a one-page statement from the group, the latest quarterly sales rise exceeded a 6 per cent rise for the three months to December 31 last year.

Included in the latest quarterly figures was a rise in department store turnover of 9.4 per cent, while for the year to the end of March sales at the "big box" stores were up 7.7 per cent.

Growth in supermarket sales, which are the main anchors for Centro shopping centres, was unchanged at 3.6 per cent for both the March quarter and the year to the end of March.

Sales for specialty stores rose 10.7 per cent for the March quarter, 13.3 per cent for the year.

The positive indications in the underlying business will be welcomed by Centro directors, who have significant hurdles to overcome by Friday week to prevent the group's financiers from appointing receivers.

To appease the bankers, Centro chief executive Glenn Rufrano has until May 30 to finalise a $155 million "liquidity facility" to pay for capital expenditure, adviser fees and higher lender costs. Centro has obtained $55 million from its financiers and is seeking $100 million more.

If the conditions are not met, the receivers would move in, the company said on May 8. If they are met, Centro has until December 15 to repay its overall $6.5 billion debt.

It is understood Centro has at least 10 centres, of the 25 up for sale, that are close to being sold, although potential buyers, who have declined to be named, said the popular malls such as Centro Bankstown, Colonnades in Adelaide, The Glen in Melbourne, and Centro Mandurah in Western Australia are not among the first assets being offered.

Mr Rufrano is also talking to two joint venture parties, the private Salta Properties, which owns the other half of the Victoria Gardens centre in Melbourne, and Leda Holdings, which jointly owns Centro Hervey Bay and the Centro Hyperdome, Tuggeranong, about the sale of the assets.

The two private groups have first right of refusal over any sale and are said to be keen to buy out Centro once capital gains tax issues and pricing can be settled.