Harworth Group plc (“Harworth” or the “Group”), a leading regenerator of land and property for sustainable development and investment, announces its interim results for the six months to 30 June 2021.
“Harworth delivered a strong first half performance, advancing planning, development activity, sales and lettings across our portfolio. We continue to see depth of market demand from occupiers and investors for both built stock and, increasingly, strategic land within our industrial and logistics portfolio, as well as for our residential serviced land product. This has resulted in significant growth in EPRA NDV and total returns during the period.
I have now concluded the review of the business that I commenced shortly after joining. The strategy that we are outlining today builds on our achievements over the last few years and drives growth in the business, maximising returns to investors and setting out a clear road map for our stakeholders. This plan represents evolution, not revolution, but with material shifts in the pace and scale of what we do, and will enable us to scale up the creation and delivery of sustainable places where people want to live and work.”
Lynda Shillaw, Chief Executive, Harworth Group plc
Strategy to double the size of the business over 5 – 7 years
- A step change in the quantum of direct development for our industrial & logistics pipeline
- Increasing the breadth of residential land products available at our sites
- Growing our strategic land portfolio and land promotion activities
- Repositioning our Investment Portfolio to modern Grade A
Strong first half returns, driven by active management and structural growth in our markets
- Total return increased to 15.4% for the first six months of 2021, driven by valuation gains
- NDV per share increased by 14.5% to 183.2p as at June 2021 from 160.0p at December 2020
- Interim dividend increased by 10% to 0.367p, in-line with our dividend policy
Planning approvals demonstrate master planning expertise and drive growth in consented landbank
- 1.1m sq. ft of industrial & logistics space approved in Wingates, Bolton, adjacent to Junction 6 of M61
- Further approvals for up to 500 new homes across smaller sites; plots currently being marketed
Progress on placemaking, direct development and sales across our Major Development sites
- Development of 332,000 sq. ft of industrial & logistics space underway at Bardon Hill, Leicestershire
- Practical completion of 50,800 sq. ft unit at Logistics North, now let to a manufacturing occupier
- Plans submitted for Olive Lane, a new heart of the community at Waverley, Rotherham
- Completed, exchanged or agreed terms on 98% of budgeted full year sales, ahead of or in-line with December 2020 valuations
Active management of Investment Portfolio delivers robust operational metrics and valuation growth
- Letting of a 149,300 sq. ft unit as part of Phase 2 of Multiply Joint Venture; further letting of a plot representing Phase 3 after period end, triggering one-off promote fees
- Rent collection of 97% for first half; vacancy remains low at 3.0% (FY 2020: 4.5%)
Business remains well-capitalised with significant financing flexibility
- Available liquidity of £36.2m (FY 2020: £62.7m) and net debt of £100.2m (FY 2020: £71.2m)
- Net loan to portfolio value of 13.4% (FY 2020: 11.5%); on track to be well within revised target of below 20% by year end
Embedding ESG into everything we do through the Harworth Way and new ESG Board Committee
- High environmental building standards, new community amenities and biodiversity gains across sites
- MSCI ESG Rating of A, reflecting our management of environmental impact
Notes:
(1) Harworth discloses both statutory and alternative performance measures (‘APMs’). A full description and reconciliation to the APMs is set out in Note 2 of the financial statements
(2) European Public Real Estate Association Net Disposal Value per share
(3) Total dividend per share in 2020 comprised a payment of 0.768p for 2020 supplemented by an additional payment of 0.698p representing the previously cancelled 2019 final dividend