Sir David Murray's core property empire continued to recover last year but at a slower pace than in 2010, according to the annual accounts of Premier Property Group (PPG) just pub-lished at Companies House.

In the year to June 2011, PPG achieved a £54 million cut to £403m in its debt to Lloyds Banking Group, which was earlier this week revealed to have injected a further £118m into parent Murray International Holdings (MIH).

PPG's turnover fell from £123m to £98m, and core operating profit almost halved to £15.6m, though post-exceptional losses fell from £34.5m to £1.5m.

Net liabilities rose by £1.5m to £104.5m, and the balance sheet shows the shareholder deficit widening from £93m to £121m.

In 2010, PPG cut its debt by almost £200m, but cash inflow from operating activities was reduced in 2011 from £226m to £66m.

Property sales were 25% lower than in 2010 at £68.4m, although the £92m sale of Plumtree Court in central London was agreed more than a year ago but will appear in the 2012 accounts. Underlying pre-tax profit fell from £10.2m to £4.3m, as property assets fell by £70m to £418m.

Sir David has said MIH's strategy hinges on "asset realisation and reduction, particularly in relation to property".

He and co-directors write that PPG enjoyed a "satisfactory trading year", with the previous year's restructuring (and £150m injection from Lloyds) enabling a focus on intensive asset management, strategic disposals and debt reduction.

They say the group benefited from a buoyant central London office market, but not from the subdued markets outside the south-east, with the retail sector and the market for development land both weak.

In addition to the near £70m from sales, rental income of £28.6m represented a minor like-for-like increase from 2010.

Trading performance was boosted by debt reduction and the net property writedown was limited to £5.8m.

PPG paid its directors £580,000 (£808,000) including £232,000 (£287,000) to the highest paid (not Sir David).