Real Estate Opportunities (REO), the listed property vehicle controlled by Treasury Holdings, has reported a pre-tax profit of £15.9 million (€23.6 million) for 2004, down from £31.4 million in the previous year.

The decline was attributable mostly to a reduction in benefits from exchange-rate movements.

The company, structured as a split-capital trust, said its net assets at the end of December last stood at £171.6 million, up almost 10 per cent on the previous year.

This resulted in the net asset value per share climbing by 10.2 per cent to 47.4p. REO concentrates on Irish property, having sold most of its UK portfolio in early 2004. The value of these Irish properties stood at just under €630 million at the end of the year. REO said it had agreed the sale of 19 more of its UK properties for £36 million, leaving its remaining UK portfolio with a value of £73.2 million.

Chairman, Ray Horney, said increases in income had come from new lettings and rent reviews. Almost 70 per cent of REO's portfolio is in office property.

The company's cash balances grew from £136,510 to £150,044 but no mention was made of a dividend. Management fees, paid to Treasury Holdings, fell from £4.3 million to £3 million. These fees are designed to cover the cost of managing REO's Irish properties and developing new projects. They have repeatedly been questioned by other shareholders.

The board is set to ask shareholders to repurchase up to 15 per cent of the company's shares at its next agm.