Tuesday, September 6, 2016

News: Harworth post first post-Brexit results

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Rotherham-based developer Harworth Group plc, one of the largest property and regeneration companies across the North of England and the Midlands, is confident in its future strategy despite uncertainty following the EU referendum.

A specialist in brownfield regeneration, Harworth is based at its own flagship development at Waverley. Its extensive portfolio consists of a total of around 22,000 acres across 140 sites. It is wholly owned by Harworth Group plc which was created through the complex restructure of what was UK Coal.

It its interim results for the half year ended 30 June 2016, the group reported that revenue from operations rose to £17.4m compared to £4.2m in the first half of 2015. This was largely as a result of forward funding at its Logistics North development.

Profit before tax was £7.4m, compared to £51.3m in the previous year that was affected by the completion of the re-acquisition of 75.1% of the shares in Harworth Estates Property Group Limited.

Net asset value increased to £303.0m, a 10.4% increase from June 2015 (£274.5m) and a 1.8% increase since December 2015 (£297.7m).

The group said that its full year financial forecasts are in line with the board's expectations but, as usual, weighted towards the second half.

Owen Michaelson, chief executive officer at Harworth Group plc, said: "Overall, trading remains in line with our expectations, with a healthy pipeline of anticipated sales.

"We have continued confidence in the economic potential of the regions in which we operate and the long term market fundamentals remains in place. Our strategy affords us flexibility to manage potential periods of uncertainty.

"The European referendum vote on 23 June 2016 led to an initial hiatus by some housebuilders and investment funds. Activity now seems to be back to previous levels however and long-term market fundamentals remain strong. In particular, the UK still needs land for new housing to meet increasing demand and there remains an under-supply of good quality, employment space in the North of England and the Midlands. We will continue to monitor market trends with our strategy and portfolio affording us flexibility to manage periods of uncertainty."

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The group sold over £13.3m of property in the first half, with the portfolio now comprising the ownership or management of 22,295 acres across 144 sites. 335 residential plots across three development parcels were sold to regional housebuilders. A number of additional sales to housebuilders were in negotiation, for completion during the second half of the year.

With improved bank facilities, the group continues to replenish its strategic landbank with new sites. Acquisitions include £9m to be part of the Temple Green development, the largest live logistics development in the Leeds City Region. Harworth also acquired Sanderson (Advantage) House in Rotherham for £2.3m. The property adjacent to the Waverley development is now home to the Harworth Group.

The group's portfolio includes 10,029 consented residential plots, alongside 10,482,221 sq ft of consented employment space. During the six-month period, outline planning consents were granted for 65 residential plots, together with 120,875 sq ft of commercial space. Planning applications for 400 residential plots have been submitted since the end of the period and further planning applications are planned for 700 residential plots and in excess of 1.5m sq. ft of commercial space by the end of the current financial year.

Harworth also said that it had "made selected moves up the development curve" during the period to generate increased value for our shareholders. It added that good progress is being made on direct build, commercial developments including the the Advanced Manufacturing Park (AMP) in Rotherham where AMPlify - 460,000 sq ft of space at the UK's centre of excellence for advanced manufacturing has recently been confirmed.

After the end of the period, a planning application for 105 dwellings by Harron Homes at Waverley in was approved by Rotherham Council. A further 53 houses are being planned for part of the site that was previously known as Highfield Commercial.

Harworth Group website

Images: Harron Homes


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