Wednesday, August 13, 2014

News: Harworth laying foundations for value realisation


Harworth Estates, the company created to realise the property assets of what was UK Coal, has reported a profit of £12.6m as it continues to grow the value of its assets.

Recovery plans for Doncaster-based UK Coal were put in place in May 2011 and the remaining focus of the new company, Coalfield Resources (CfR), is targeting the realisation of its property assets through the Harworth Estates Property Group Limited.

Coalfield Resources, which owns 24.9% stake in Harworth Estates, has reported a profit from continuing operations before tax of £3.2m for the half year ended June 30 2014. This compares to a loss of £0.1m in the same period last year. Harworth Estates continues to perform well and achieved a profit for the first half of 2014 of £12.6m.

Harworth Estates, which is based on its flagship development at Waverley in Rotherham, manages around 31,370 acres across some 200 projects, with consent for 8,000 new homes. By regenerating former coalfields and brownfield land it now values its investment properties at £283.7m, up from £278.5m, and net assets at £247.3m, up from £234.7m.

Jonson Cox, chairman of Coalfield Resources plc, said: "Our objective is to deliver value from our investment in Harworth Estates as it implements its strategy to maximise value across its portfolio. The first half of 2014, saw this strategy continue to deliver, generating a profit, and asset value growth, of £3.1m for CfR.

"Although we are only at an early stage in the process, we strongly believe the Harworth Estates team has laid the foundations for continued value realisation. When it is equipped with an improved capital structure, we believe further value can be realised both from the portfolio through organic growth and by adding value through selective brownfield property development and acquisition opportunities."

Harworth Estates has become a standalone property business with its core strategy moving from a focus of property disposals to repay its inherited bank debt to one of delivering and maximising value across its portfolio. Its own banks have moved it from business support into their regular property business. As part of this, both banks have allowed loan repayment holidays, reflecting their confidence in the Harworth Estates business, allowing the business to invest additional cash and add value to its portfolio.

Progress continues to be made at the Advanced Manufacturing Park (AMP), the UK's premier advanced manufacturing technology park, part of the £100m Waverley development on the site of the former Orgreave colliery in Rotherham.

During the period, disposals of a further three parcels of land have taken place including a pre-sold design and build for 52,000 sq ft of buildings on the AMP Re-evolution phase (pictured, under construction).

Following the sale of the first six phases to house builders over the past 24 months the group is still seeing demand for further phases and these will be progressed in the second half. Harworth also secured a further infrastructure loan to allow accelerated infrastructure works on the Waverley site.

In June, Harworth submitted changes to its masterplan for the Waverley development to reflect the change in phasing as the development comes forward. If approved it would see fewer apartments and more houses.

Progress is also being made at Logistics North, the UK's sixth largest industrial scheme with live planning permission.

As the developments progress, Harworth has grown its core workforce by over a quarter in the past 12 months and took on four new staff in July.

Harworth Estates website

Images: Harworth Estates


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