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HAMMERSON CANADA INC. HALF YEAR RESULTS

MISSISSAUGA, Ont., Sept. 4 /CNW/ - Net rental income for the six months
was $25.5 million compared to $26.2 million in 1997, a decrease of $0.7
million. Net rental income for the retail properties increased by $1.1 million
and for those office properties held throughout the six months ended June 30,
1998 net rental income increased by $1.2 million. These increases were more
than offset by the impact of the sale in August 1997 of four Mississauga
office buildings which provided net rental income of $3.0 million in the six
months to June 30, 1997. 
The Company's net income after tax for the six months ended June 30, 1998
was $3.7 million compared to a loss of $0.2 million in 1997. The principal
reason for this was a tax credit of $4.4 million recorded upon the settlement
of a Revenue Canada audit partly offset by reductions of $0.7 million in net
rental income. 
The Canadian real estate market continues to show strength due to the
underlying economic fundamentals. The Company's portfolio of properties
continues to perform well with the volume of all store retail sales of the
Company's enclosed retail malls up 8.2% over the prior year. At June 30, 1998,
the Company's retail portfolio was 98.6% leased and the office portfolio,
excluding 11 King Street West, was 95.9% leased. 
During the period, the refurbishment program of 11 King Street West was
completed. Potential tenant interest in the building is strong and occupancy
is over 20% at rates in excess of the Company's plans. 
Also during the period, the Company started construction of the 310,000
square foot Square One Powerhouse expansion. This retail and entertainment
expansion of Square One is scheduled for completion in November 1999 and is
expected to provide added excitement and vibrancy to the Mississauga City
Centre. 
As Hammerson Canada Inc. is the wholly owned subsidiary of Hammerson plc,
these results should be read in conjunction with those of the parent company. 


    For further information:
    Elisabeth Stroback, President             Tel:  (905) 270-7000
    Hammerson Canada Inc.                     Fax:  (905) 270-7002
    Suite 800, 201 City Centre Drive
    Mississauga, Ontario
    L5B 2T4
    Simon R. Melliss, Group Finance Director  Tel:  011-44-171-887-1000
    Hammerson plc                             Fax:  011-44-171-887-1010
    100 Park Lane
    London, England
    W1Y 4AR
    Hammerson Half Year Results
    ---------------------------
    Hammerson plc announces unaudited results for the six months
    to 30 June 1998.
    <<
    Financial highlights:
                                       1998              1997      percentage
                                                                     change
    Net rental income              60.0m pnds stlg   62.2m pnds stlg   -3.5%
    Profit before tax              36.0m pnds stlg   30.5m pnds stlg  +18.0%
    Adjusted profit
     before taxation(x)            32.4m pnds stlg   30.5m pnds stlg  +6.2%
    Earnings per share                 11.4p              7.9p        +44.3%
    Adjusted earnings per share(x)     10.1p              7.9p        +27.8%
    Dividend per share, payable
     7 April 1999                      4.13p              3.8p
    (x) Excluding exceptional items
    >>
    Operational highlights:


-  Capital expenditure of 195 million pnds stlg, including the
acquisition of the Italie 2 shopping centre in Paris and a 50% interest in a
regional shopping centre development, West Quay, Southampton. 
-  Six properties sold during the first half of the year for a total of
38 million pnds stlg. 


    -  Good progress on the development programme:
       -  Globe House, a major pre-let London office building, completed;
       -  Retail developments at The Oracle, Reading, and West Quay,
          Southampton, now well advanced;
       -  Office developments underway at Britannia House, London, and 40 rue
          de Courcelles, Paris;
       -  Expansion started at Square One Shopping Centre, Mississauga;
       -  Encouraging level of lettings secured at schemes currently
          underway.


-  Acquisition of major interests in two French shopping centres and a
property management company for approximately 60 million pnds stlg announced
today. 


    The Chairman, Geoffrey Maitland Smith, said today:
       ``Hammerson continues to benefit from the efforts made over the past
       few years to improve the quality of the group's portfolio and income.
       Excluding the effects of acquisitions and disposals, there was an
       underlying increase in net rental income of 3.4%. Adjusted pre-tax
       profits for the six months to 30 June 1998 increased by 6.2% to 32.4
       million pnds stlg.
       During the first half of the year, good progress was made on the
       group's development programme. Our objectives are to create high
       quality assets while, at the same time, minimising the risks inherent
       in development by rigorous project management, by ensuring that all
       projects are carefully phased and controlled and by pro-active leasing
       programmes. There has been a healthy level of take up of space in the
       schemes currently underway.
       Despite recent signs of a slowdown in the UK economy, demand for the
       group's properties since 30 June has been encouraging. Overseas, there
       have been further improvements in the economies in continental Europe
       and Canada, where conditions in the property markets remain
       favourable. I believe the group's portfolio and its current
       development programme offer good future growth potential.
       The directors have declared an interim dividend of 4.13 pence per
       share, with payment deferred until 7 April 1999. The total dividend
       payment comprises an underlying dividend of 3.99 pence, an increase of
       5.0% on the 1997 interim dividend, and a sum of 0.14 pence per share
       to allow for the deferral of the dividend payment.''
    For further information:
    Ronald R Spinney                   Tel: 0171 887 1000
    Chief Executive                    Fax: 0171 887 1010
    Simon R Melliss
    Group Finance Director
    Christopher D M Smith,
    Director of Corporate Affairs
                         CHAIRMAN'S STATEMENT
                         --------------------
    Results and Dividend


Hammerson continues to benefit from the efforts made over the past few
years to improve the quality of the group's portfolio and income. Adjusted
pre-tax profits for the six months to 30 June 1998 increased by 6.2% to 32.4
million pnds stlg. Reflecting this and a lower tax charge, adjusted earnings
per share increased by 27.8% to 10.1 pence. 
Excluding the effects of acquisitions and disposals, there was an
underlying increase in net rental income of 3.4%. There were higher
contributions from 99 Bishopsgate, London, and Wellington House, Slough, while
in Paris, the lease expiry and start of redevelopment of 40 rue de Courcelles
reduced rental income by 1.3 million pnds stlg. 
The tax charge for the six months to 30 June 1998 was 2.5 million pnds
stlg compared with 7.2 million pnds stlg for the corresponding period in 1997.
This reflected the benefits to the company of shareholders electing to receive
the scrip alternative to the 1997 final dividend, the deferral of the 1998
interim dividend payment referred to below and the consequent utilisation of
some of the Advance Corporation Tax written off in previous years. 
The directors have declared an interim dividend of 4.13 pence per share,
with payment deferred until 7 April 1999 when ACT will have been abolished.
The reduction in tax resulting from this one-off deferral enhances the
company's 1998 earnings by 3.0 million pnds stlg. The total dividend payment
comprises an underlying dividend of 3.99 pence, an increase of 5.0% on the
1997 interim dividend, and a sum of 0.14 pence per share to allow for the
deferral of the dividend payment. No scrip alternative to the interim dividend
is being offered. 
Cash Flow and Balance Sheet 
Operating cash flow after deducting finance, tax and dividend payments
for the six months to 30 June 1998 was 15.1 million pnds stlg, compared with
6.5 million pnds stlg in the first half of 1997. This reflected the reduction
in tax payable and the increased take up of the scrip dividend alternative. 
During the first half of the year, the group invested a total of 195
million pnds stlg. This included the acquisition of the 56,000 m(2) Italie 2
regional shopping centre in Paris for 93 million pnds stlg and the acquisition
of, and subsequent expenditure on, a 50% interest in West Quay, Southampton, a
major retail development. 
Six properties were sold during the first half of the year - 33 St
James's Square, London SW1 and 40/42 South Molton Street, London W1 and four
office properties in Paris - raising a total of 38 million pnds stlg. 
The group's net borrowings increased by 127 million pnds stlg to 708
million pnds stlg. Net capital expenditure of 157 million pnds stlg was
partially offset by operating cash flow of 15 million pnds stlg. Currency
movements reduced the sterling value of the group's borrowings by 15 million
pnds stlg. 
In April, Hammerson arranged a 200 million pnds stlg unsecured 30 year
bond issue at a coupon of 7.25% per annum. The very long maturity of this
financing has lengthened the average maturity of the group's borrowings to 14
years. 
Hammerson's financial condition remains strong.  Gearing was 55% at 30
June 1998, compared with 46% at the 1997 year end and the group had cash
balances of 210 million pnds stlg and 292 million pnds stlg of undrawn
committed facilities. 
Since 30 June, Hammerson has acquired interests in two shopping centres
and a property management company in France for approximately 60 million pnds
stlg. 
Development Programme 
During the first half of the year, good progress was made on the group's
development programme. Our objectives are to create high quality assets while,
at the same time, minimising the risks inherent in development by rigorous
project management, by ensuring that all projects are carefully phased and
controlled and by pro-active leasing programmes. There has been a healthy
level of take up of space in the schemes currently underway. 
Globe House, the 17,700 m(2) office property on London's Embankment, was
completed at the end of June and has now been handed over to the tenant, BAT
Industries plc, for fitting out. The property will be revalued at 31 December
1998 and will be included in the year end balance sheet as a completed
investment property. 
Good progress is being made at The Oracle, Reading, the joint venture
development with ADIA of a 65,000 m(2) regional shopping centre. The two
department stores are due to be handed over to the major anchor tenants,
Debenhams and House of Fraser, later this year and the centre is scheduled to
open in autumn 1999. Agreements have been exchanged with prospective tenants
in respect of 31% of the anticipated total income from the scheme. Leases in
respect of a further 30% of the potential income are in solicitors' hands. 
In February Hammerson acquired a 50% interest in West Quay, Southampton,
a joint venture with Barclays PLC, to develop a regional shopping centre of
70,600 m(2). We subsequently initiated several design improvements, including
an increase in the lettable area of 2,500 m(2), and construction is now well
underway. Leases have been exchanged with John Lewis and Marks & Spencer, the
anchor tenants, ahead of our formal marketing launch to retailers, which takes
place shortly. The centre is scheduled to open in autumn 2000. 
At the Bull Ring, Birmingham, we have continued to progress our plans to
develop a 110,000 m(2) shopping centre. Meanwhile, we are holding initial
discussions with Land Securities and Henderson Investors, the owners of a
nearby site earmarked for shopping centre development, to co-ordinate our
respective schemes. 
At Brent Cross, the group continues to advance its proposed 27,000 m(2)
expansion which will increase the size of the shopping centre to 105,000 m(2). 
In March, Hammerson acquired the freehold of Britannia House, 16/17 Old
Bailey, London EC4. The group has started work on a redevelopment of the site
to provide 8,400 m(2) of offices behind the building's existing classical
facade. The 49 million pnds stlg scheme is scheduled for completion in spring
2000 and there is already interest from prospective occupiers. 
At 40 rue de Courcelles, Paris, the group is developing 17,700 m(2) of
high quality offices. Work on site started in April and is scheduled for
completion in September 1999. A marketing campaign has recently been initiated
and preliminary enquiries are very encouraging. 
In April, Hammerson started work on a major expansion of Square One, its
super-regional shopping centre in Mississauga. These works are due to be
completed in autumn 1999 at a total cost of 50 million pnds stlg. Already over
50% of the 28,000 m(2) of new space has been pre-let to domestic and
international retailers and leisure operators. 
In Toronto, the refurbishment of 11 King Street West, an office building
of 15,000 m(2) was completed in March. Around 20% of the space in the building
has now been leased. 
Year 2000 
During the first half of 1998 we have progressed the replacement of
non-compliant computer systems and equipment at our administrative offices.
Having identified the key areas of risk in the property portfolio, the asset
management teams are continuing the process of testing critical systems,
implementing remedial works and preparing contingency plans. 
Markets and Outlook 
In the UK, there was good demand from retailers for space in major
well-located shopping centres. There was a continuing shortage of prime office
space in central London, which was reflected in increased rents. Both for
shopping centres and offices, there was little movement in investment yields
from the beginning of the year. 
In France, the economy continued to strengthen. Although overall retail
spending grew only marginally, major shopping centres increased their market
share and this was reflected in healthy demand for units in the group's
shopping centres, particularly from international retailers. In Paris, rents
for prime centrally-located offices increased as a result of higher leasing
activity and limited supply. Investment demand firmed both for prime shopping
centres and central Paris office properties. 
In Germany, the economy improved in the first half of 1998. There was
generally an increase in turnover at Hammerson's shopping centres and this was
accompanied by increased demand for space. Property investment yields in
Germany continued to remain stable. 
In Canada, the economy continued to improve but uncertainties in the Far
East hindered growth. Nevertheless, consumer spending strengthened, leading to
rental growth at well-located shopping centres. Toronto office markets showed
a further improvement, reflecting the limited availability of prime space  In
both the shopping centre and office sectors there was good investment demand
for high quality space and this was reflected in some improvement in
investment yields. 
Despite recent signs of a slowdown in the UK economy, demand for the
group's properties since 30 June has been encouraging. Overseas, there have
been further improvements in the economies in continental Europe and Canada,
where conditions in the property markets remain favourable. I believe the
group's portfolio and its current development programme offer good future
growth potential. 
Management 
We were greatly saddened by the death in June this year of Tom Hutchison,
who joined Hammerson as a non-executive director in 1991. I would like to
acknowledge the major contribution he made to the company. 
This year we have been joined by two new directors.  John Bywater was
appointed Managing Director of Hammerson UK in April and John Barton joined us
in July as a non-executive director. We welcome them both to the Board. 
In conclusion, I would like to thank Hammerson's management and staff for
their enthusiasm and commitment to ensuring Hammerson's continuing progress. 


    Geoffrey Maitland Smith
    Chairman
    4 September 1998
    <<
                    Unaudited Consolidated Profit and Loss Account
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                            Notes     30 June       30 June
                                                       1998      1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
       123.6    Net rental income             1        60.0          62.2
       (15.6)   Administration expenses                (8.0)         (8.0)
    -------------------------------------------------------------------------
       108.0    Operating profit                       52.0          54.2
                Exceptional item:
                Profit/(loss) on sale of
        (0.9)   investment properties                   3.6             -
    -------------------------------------------------------------------------
                Profit on ordinary
       107.1    activities before interest             55.6          54.2
       (45.4)   Cost of finance (net)         2       (19.6)        (23.7)
    -------------------------------------------------------------------------
                Profit on ordinary
        61.7    activities before taxation             36.0          30.5
       (14.9)   Taxation                      3        (2.5)         (7.2)
    -------------------------------------------------------------------------
                Profit on ordinary
        46.8    activities after taxation              33.5          23.3
        (1.8)   Equity minority interests              (0.9)         (0.9)
    -------------------------------------------------------------------------
        45.0    Profit for the period                  32.6          22.4
      (33.9)    Dividends                     4       (11.9)        (10.8)
    -------------------------------------------------------------------------
       11.1     Retained profit                        20.7          11.6
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
       15.8p    Earnings per share            5        11.4p          7.9p
       17.0p    Adjusted earnings per share   5        10.1p          7.9p
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Unaudited Consolidated Cash Flow Statement
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                            Notes     30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
                Net cash inflow from
       109.5    operating activities          6        48.7          52.0
                Net cash outflow from
                returns on investment and
       (50.1)   servicing of finance          6       (20.0)        (20.8)
       (11.4)   Corporation tax paid                   (2.1)         (3.5)
                Net cash (outflow)/inflow
        14.9    from capital expenditure      6      (157.4)        (27.3)
                Net cash outflow from
       (20.4)   acquisitions and disposals                -         (20.5)
       (26.6)   Equity dividends paid                 (11.5)        (21.2)
    -------------------------------------------------------------------------
                Cash (outflow)/inflow
                before movements in liquid
        15.9    resources and financing              (142.3)        (41.3)
                (Increase)/Decrease in
        18.6    liquid resources                     (125.7)         45.0
                Net cash inflow/(outflow)
       (44.9)   from financing                7       271.0          12.8
    -------------------------------------------------------------------------
                Increase/(Decrease) in
       (10.4)   cash in the period                      3.0          16.5
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Unaudited Reconciliation of Net Cash Flow to Movement in Net Debt
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                                      30 June       30 June
                                                        1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
                Increase/(Decrease) in
       (10.4)   cash in the period                      3.0          16.5
        47.0    (Increase)/Decrease in debt          (271.0)        (10.8)
                Increase/(Decrease) in liquid
       (18.6)   resources                             125.7         (45.0)
    -------------------------------------------------------------------------
                Change in net debt
        18.0    resulting from cash flows            (142.3)        (39.3)
        35.3    Exchange adjustment                    14.9          24.6
    -------------------------------------------------------------------------
        53.3    Movement in net debt in the period   (127.4)        (14.7)
      (634.1)   Opening net debt                     (580.8)       (634.1)
    -------------------------------------------------------------------------
      (580.8)   Closing net debt                     (708.2)       (648.8)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                     Unaudited Consolidated Balance Sheet
    31 December 1997                        Notes    30 June       30 June
                                                      1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m 
                Fixed assets
     1,953.4    Land and buildings            8     2,096.4       1,855.3
         1.3    Fixtures and fittings                   1.5           1.4
    -------------------------------------------------------------------------
     1,954.7                                        2,097.9       1,856.7
                Current assets
        36.5    Debtors                                41.1          43.5
        81.6    Cash and short term deposits          210.2          82.3
    -------------------------------------------------------------------------
       118.1                                          251.3         125.8
                Creditors falling due within one year
       (42.6)   Borrowings                    9       (37.1)        (50.1)
      (111.4)   Other                                (100.4)       (100.0)
    -------------------------------------------------------------------------
                Net current
       (35.9)   assets/(liabilities)                  113.8         (24.3)
    -------------------------------------------------------------------------
                Total assets less current
     1,918.8    liabilities                         2,211.7       1,832.4
                Creditors falling due
                after more than one year
                Borrowings, including
      (619.8)   convertible bonds             9      (881.3)       (681.0)
       (13.7)   Other                                 (17.7)        (11.2)
       (32.5)   Equity minority interests             (32.3)        (27.6)
    -------------------------------------------------------------------------
     1,252.8                                        1,280.4       1,112.6
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                Capital and reserves
        71.4    Called up share capital                72.0          71.1
       525.9    Share premium account                 525.7         526.0
       391.1    Revaluation reserve                   379.0         215.3
         1.5    Other reserves                          1.5           1.5
       262.9    Profit and loss account               302.2         298.7
    -------------------------------------------------------------------------
     1,252.8    Equity shareholders' funds   10     1,280.4       1,112.6
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Notes to the Accounts
    1 NET RENTAL INCOME
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                                      30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
        77.5    United Kingdom                         39.0          37.7
        22.1    Canada                                 10.9          12.0
        17.8    France                                  6.9           8.8
         5.7    Germany                                 3.2           3.1
         0.5    Spain                                     -           0.6
    -------------------------------------------------------------------------
       123.6                                           60.0          62.2
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    The net rental income of pnds stlg 62.2m for the six months ended 30
    June 1997 was equivalent to pnds stlg 61.0m translated at 30 June 1998
    exchange rates.
    2  COST OF FINANCE (net)
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                                      30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
        54.3    Interest payable and similar charges   29.3          27.5
        (2.7)   Interest payable capitalised           (5.1)         (1.0)
        (6.2)   Interest receivable                    (4.6)         (2.8)
    -------------------------------------------------------------------------
        45.4                                           19.6          23.7
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    The net cost of finance of pnds stlg 23.7m for the six months ended 30
    June 1997 was equivalent to pnds stlg 22.6m translated at 30 June 1998
    exchange rates.
    3  TAXATION
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                                      30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
                United Kingdom corporation tax
        11.8    at 31% (1997: 31.5%)                    6.5           6.1
                Advance corporation tax
       (0.5)    (written back)/written off             (4.8)          0.5
    -------------------------------------------------------------------------
       11.3                                             1.7           6.6
        3.6     Overseas taxation                       0.8           0.6
    -------------------------------------------------------------------------
       14.9                                             2.5           7.2
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    >>
    The tax charge for the six months ended 30 June 1998 takes
    into account the abolition of Advance Corporation Tax and is
    based on the projected effective tax rate for the full year.
                            Notes to the Accounts
    4  DIVIDENDS
    The directors have declared an interim dividend of 4.13 pence per share
    payable to shareholders on the register at the close of business on
    18 September 1998. Payment has been deferred until 7 April 1999, at
    which time Advance Corporation Tax will have been abolished. The total
    dividend payment comprises an underlying dividend of 3.99 pence and a
    sum of 0.14p pence per share to allow for the deferral of the
    dividend payment. No scrip alternative to the interim dividend is being
    offered.
    In respect of shareholders registered on the Canadian Branch Register,
    the dividend will be paid in Canadian dollars converted from sterling
    at the exchange rate quoted by the Bank of Canada at 12 noon on 18
    September 1998.
    5  EARNINGS PER SHARE
    Earnings per share have been calculated on the profits attributable to
    shareholders of pnds stlg 32.6m and the weighted average number of shares
    in issue during the six months ended 30 June 1998 of 286.1m.
    Adjusted earnings per share exclude exceptional items and are calculated
    on the adjusted profits of pnds stlg 29.0m.
    <<
    6  ANALYSIS OF CASH FLOWS
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                                      30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
                Reconciliation of operating
                profit to net cash inflow
                from operating activities
       108.0    Operating profit                       52.0          54.2
         0.6    Depreciation                            0.3           0.2
         1.0    Letting costs written off                 -           0.2
         4.5    (Increase)/Decrease in debtors         (6.3)         (3.4)
        (4.6)   Increase/(Decrease) in creditors        2.7           0.8
    -------------------------------------------------------------------------
       109.5                                           48.7          52.0
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                Net cash outflow from returns
                on investment and servicing
                of finance
         6.0    Interest received                       5.1           2.9
       (54.5)   Interest paid                         (24.2)        (22.8)
        (1.6)   Dividend paid to minorities            (0.9)         (0.9)
    -------------------------------------------------------------------------
       (50.1)                                         (20.0)        (20.8)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                Net cash (outflow)/inflow
                from capital expenditure
       (97.7)   Purchase and development of property (195.3)        (45.3)
       112.6    Sale of investment properties          37.9          18.0
    -------------------------------------------------------------------------
        14.9                                         (157.4)        (27.3)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                            Notes to the Accounts
    7  ANALYSIS OF CASH FLOW FROM FINANCING
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                                      30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
           -    Issue of bonds                        197.0             -
         2.1    Issue of shares                           -           2.0
                Increase/(Decrease) in medium
       (26.8)   term borrowings                        78.2         (23.4)
                (Decrease)/Increase in short
       (20.2)   term borrowings                        (4.2)         34.2
    -------------------------------------------------------------------------
       (44.9)                                         271.0          12.8
    -------------------------------------------------------------------------
    8  LAND AND BUILDINGS
                                            Investment properties
                                                  In the course of
                                 Fully developed    development       Total
                                    pnds stlg         pnds stlg    pnds stlg
                                        m                 m            m
       Balance at 1 January
        1998:     At valuation       1,858.8               -        1,858.8
                  At cost                  -            94.6           94.6
       Exchange and other adjustments  (19.7)           (1.0)         (20.7)
       Additions at cost               106.8            86.8          193.6
       Disposals                       (34.4)              -          (34.4)
       Transfers                       (40.7)           40.7              -
       Development outgoings
        capitalised                        -             4.5            4.5
    -------------------------------------------------------------------------
       Balance at 30 June 1998       1,870.8           225.6        2,096.4
    -------------------------------------------------------------------------
    The property portfolio is valued annually at the end of each
    financial year and accordingly has not been revalued at 30
    June 1998.
    9  BORROWINGS
    Year ended                                       Six months    Six months
    31 December  1997                                  ended         ended
                                                      30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
       134.1    Bank loans and overdrafts             203.1         134.5
       363.7    Other loans: Unsecured                551.6         429.0
        57.1                 Secured                   55.9          60.2
       107.5    Convertible bonds                     107.8         107.4
    -------------------------------------------------------------------------
       662.4                                          918.4         731.1
    -------------------------------------------------------------------------
    Net borrowings at 30 June 1998 were pnds stlg 708.2m and gearing was
    55% based on year end 1997 property values. Other unsecured
    loans comprise the group's Canadian dollar and Sterling bonds,
    including the pnds stlg 200m 30 year bond issued in April 1998, and
    Canadian dollar commercial paper.
                            Notes to the Accounts
    10  RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
    Year ended                                       Six months    Six months
    31 December 1997                                   ended         ended
                                                      30 June       30 June
                                                       1998          1997
      pnds stlg                                      pnds stlg     pnds stlg
          m                                              m             m
        45.0    Profit for the period                  32.6          22.4
       138.8    Unrealised surplus on revaluation
                of properties                             -             -
        (5.6)   Exchange and other movements           (5.2)         (2.0)
    -------------------------------------------------------------------------
       178.2    Total recognised gains and
                losses for the period                  27.4          20.4
       (33.9)   Dividends                             (11.9)        (10.8)
         7.5    New share capital issued               12.1           2.0
       151.8    Net increase in shareholders' funds    27.6          11.6
     1,101.0    Opening shareholders' funds         1,252.8       1,101.0
    -------------------------------------------------------------------------
     1,252.8    Closing shareholders' funds         1,280.4       1,112.6
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
        >>
    11  OTHER INFORMATION
    The financial information contained in this report does not constitute
    statutory accounts within the meaning of section 240 of the Companies
    Act 1985. The results for the year ended 31 December 1997 are an
    abridged version of the full accounts for that year which received an
    unqualified report from the auditors which did not contain a statement
    under s237(2) or (3) of the Companies Act 1985. The full accounts for
    the year ended 31 December 1997 have been filed with the Registrar of
    Companies.
    The group has adopted Financial Reporting Standard (`FRS') No. 9,
    `Associates and Joint Ventures'. As a result, the group's investment in
    Essen Shopping Centre BV has been reclassified as a joint arrangement and
    the group's share of its assets, liabilities and cash flows consolidated.
    Comparative figures have been reclassified. The value of shareholders'
    funds and the profit for the period are not affected by this
    reclassification.
    Subject to the adoption of FRS 9 referred to above, the unaudited
    financial information contained in this report has been prepared on the
    basis of the accounting policies set out in the full accounts for the
    year ended 31 December 1997, except that the property portfolio has not
    been revalued at 30 June 1998.
    Directors
    G Maitland Smith  FCA (CHAIRMAN)
    R R Spinney  FRICS (CHIEF EXECUTIVE)
    R J G Richards  BSc, FRICS
    S R Melliss  BA, FCA
    J A Bywater  FRICS
    R J O Barton  CA, MBA
    F B Charnock  FRICS
    G F Pimlott  MA
    SECRETARY S J Haydon  FCIS
    Offices
    GROUP
    Hammerson plc, 100 Park Lane, London W1Y 4AR
    Tel: (0171) 887 1000  Fax (0171) 887 1010
    UNITED KINGDOM
    Hammerson UK Properties plc, 100 Park Lane, London W1Y 4AR
    Tel (0171) 887 1000  Fax (0171) 887 1090
    FRANCE
    Hammerson SA, Washington Plaza Immeuble Artois, 44 rue Washington,
    75408 Paris
    Tel (1) 56 69 30 00  Fax (1) 56 69 30 01
    GERMANY
    Hammerson GmbH, Wilhelm-Leuschner-Strasse 10, 60329 Frankfurt
    Tel (69) 25 26 14  Fax (69) 25 33 48
    CANADA
    Hammerson Canada Inc, 201 City Centre Drive, Suite 800,
    Mississauga, Ontario L5B 2T4
    Tel (905) 270 7000  Fax (905) 270 7001
    -0-                        09/04/98


/For further information: Elisabeth Stroback, President, Hammerson Canada
Inc., Suite 800, 201 City Centre Drive, Mississauga, Ontario L5B 2T4, Tel:
(905) 270-7000, Fax:  (905) 270-7002; Simon R. Melliss, Group Finance
Director, Hammerson plc, 100 Park Lane, London, England W1Y 4AR, Tel:
011-44-171-887-1000, Fax:  011-44-171-887-1010; Ronald R Spinney, Chief
Executive; Simon R Melliss, Group Finance Director; Christopher D M Smith,
Director of Corporate Affairs, Tel: 0171 887 1000, Fax: 0171 887 1010/ 
(HPD.) 
CO:  Hammerson Canada Inc.; Hammerson plc.
ST:  Ontario
IN:
SU:  ERN DIV 
-30-
â
-0- (CNS) Sep/04/98   12:55