St Modwen reported a 14% decline in its net asset value today in its full year results and said it would suspend its final dividend payment.

The regeneration specialist's NAV declined from 387p to 333p a share in the year to 30 November, due largely to a devaluation of its developments and residential land bank. The total value of its investment portfolio, including all its joint ventures, fell by £32m to £1.1bn.

St Modwen also reported a lower trading profit of £8.2m down from its £50.9m trading profit last year. It achieved property sales of £146m this year in 104 transactions. The pretax loss of £73m compares with a profit of £100m a year earlier, while its revenue rose to £146.5m from £127.5m.

Chairman Anthony Glossop said the company remained compliant with its banking covenants and forecast it would remain so throughout 2009. All its main banking facilities are secured through to 2011.

He said: ‘The company’s focus will continue to be on cash and asset management, on making the selective disposal necessary to remain within our banking covenants and to maintain cash flow, and on marshalling our long-term projects through the planning process to ensure that schemes are in good shape for the eventual recovery.

‘We believe that the long-term prospects for the company remain good, and that the net asset value is robust, with realistic valuations in place.’

Glossop said it would cut its final dividend payment as the funds would be better used in the business operation ‘until market conditions improve’

Analyst opinions were mixed with Numis keeping a ‘buy’ rating because of St Modwen’s ‘unique blend’ of development and investment properties. However, BC Peel Hunt said that St Modwen should do more to protect its balance sheet as meeting future banking obligations would require the disposal of more assets.

St Modwen’s share price fell more than 5% in early trading to 86.3p a share.

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