Harworth reports 2022 Full Year Results

A year of operational and strategic progress despite a rapidly changing market backdrop in H2.

Harworth Group plc (“Harworth” or the “Group”), a leading regenerator of land and property for sustainable development and investment, today announces its results for the 12 months ended 31 December 2022.

“We continued to make significant operational progress during the year, delivering increased levels of direct development, accelerated land sales and targeted acquisitions in line with our strategy to become a £1bn business by 2027. We ended the year in a strong financial position, with a low LTV and significant available liquidity. Following a significant increase in valuations during the first half, we saw market-driven outward yield shifts across our Investment Portfolio and more mature industrial & logistics development sites during the second half. Over the course of the year, our management actions have largely offset market movements, and resulted in our valuations, and therefore EPRA NDV, remaining broadly flat year-on-year.

“At this early stage in the year we remain cautious about the economic backdrop for 2023. While there have been some recent positive indicators, uncertainty is likely to remain in our markets until interest rates reach their peak, and inflation falls back to manageable levels, creating the conditions for growth and improved investor confidence. Against this backdrop, our focus markets of residential and industrial & logistics continue to be drivers of economic growth and have robust fundamentals, while there remains an acute shortage of high-quality consented land.

“Harworth is a long-term through-the-cycle business, which means that we look through near-term market conditions. We control our landbank, where and when we invest, and have a highly experienced management team who are focused on execution. We are confident that our strategy is the right one to deliver long-term value to stakeholders while progressing our Net Zero Carbon commitments, and our strong financial position, differentiated products, and the scale and mix of our portfolio, position us well to realise the full potential of our sites.”

Lynda Shillaw, Chief Executive, Harworth Group plc

Record direct development of Grade A space within 35.0m sq. ft industrial & logistics pipeline, with good occupier demand remaining

  • Completed 332,000 sq. ft development at Bardon Hill in Leicestershire in September, which achieved Net Zero Carbon (‘NZC’) in construction status and is now part of the Investment Portfolio: 65% of space currently let or in heads of terms
  • Completion after year-end of 110,000 sq. ft at Gateway 36 in Barnsley: 90% of space currently let or in heads of terms
  • After year-end, agreed terms for a 73,000 sq. ft built-to-suit unit at the Advanced Manufacturing Park in Rotherham, to be retained in the Investment Portfolio after completion

Robust housebuilder demand and management actions drove significant growth in residential plot sales in line with, or ahead of, book value, with potential to deliver a further 29,311 plots from pipeline

  • Completed residential land sales representing 2,236 plots (2021: 1,411 plots); H2 sales were at prices in line with, or ahead of, June 2022 valuations
  • First residential serviced land sale at Ironbridge development in Shropshire, to Barratt and David Wilson Homes, for the delivery of the initial 110 of the planned 1,000 houses at the site
  • Placemaking continues across sites: planning secured for new retail provision at South East Coalville in Leicestershire and a medical centre at Waverley, and planning submitted for new forest schools at South East Coalville and Thoresby Vale in Nottinghamshire
  • Selected preferred investment and construction partners for development by Harworth of a single-family Build-to-Rent (‘BTR’) portfolio

Acquisitions further strengthened pipeline, with several significant sites progressing through the planning system

  • Acquisitions added 2,643 plots and 8.5m sq. ft to the pipeline: includes option agreements to deliver up to 3.0m sq. ft at a site in North Yorkshire, and up to 1.6m sq. ft adjacent to Junction 15 of the M1 in Northamptonshire
  • Secured planning permission for 248 residential units across four sites during the year, and for 278,000 sq. ft of industrial & logistics space after year-end across two sites
  • Applications for 5.6m sq. ft of industrial & logistics space in the planning system at year-end

Investment Portfolio at 18% Grade A (31 Dec 2021: 11%): strong operational metrics resulting from ongoing occupier demand and rising rents

  • Vacancy rate(4) of 8.3% at year-end, reduced to 2.7% by excluding recently completed Bardon Hill site (31 December 2021: 4.1%); 99% of rent collected for 2022 to date
  • Leasing activity added £1.7m of annualised rent: new lettings at an average 10% premium to estimated rental values (‘ERVs’), and renewals on average 8% ahead of previous passing rent
  • After year-end, completed the sale of two sites for a total of £12.6m, broadly in line with or ahead of December 2022 valuations, as part of strategy to transition the Investment Portfolio to Grade A

Management actions largely offset market-driven yield shifts, leading to market outperformance for Total Return

  • Total Return(1) of 0.1% (2021: 24.6%), reflecting the marginal decline in EPRA NDV
  • EPRA NDV(1)(2) per share broadly flat 196.5p (31 Dec 2021: 197.6p), as a result of market-driven outward yield movements in the valuation of the Investment Portfolio and our more mature industrial & logistics major development sites offset by management actions
  • EPRA NDV marginally decreased by 0.6% to £633.8m (31 December 2021: £637.5m)
  • An increase of 10% in the final dividend to 0.929p per share, in line with the Group’s dividend policy, bringing the total dividend for the year to 1.333p per share

Focus maintained on sustainability and plans to be NZC by 2040 (and by 2030 for operations)

  • All direct development retained in Investment Portfolio constructed to Harworth’s sustainable commercial building specification
  • Launch of NZC pathway, with specific targets for development and Investment Portfolio activities from now until 2040

Strong balance sheet and financial position, with a low net loan to portfolio value (‘LTV’) and significant available liquidity

  • Year-end net debt of £48.4m (31 December 2021: £25.7m), representing LTV of 6.6% (31 December 2021: 3.4%)
  • Available liquidity of £175.6m (31 December 2021: £128.0m); no major refinancing requirements until 2027


(1) Harworth discloses both statutory and alternative performance measures (‘APMs’). A full description of, and reconciliation to, the APMs is set out in Note 2 to the financial statements
(2) European Public Real Estate Association Net Disposal Value
(3) The Ex-dividend date, Record date and Payment date for the 2022 dividend can be found in the Shareholder Information section of this announcement
(4) Calculated using the EPRA Best Practices Recommendations Guidelines, with comparator recalculated on the same basis