Developer U+I (UAI) had already warned that development and trading gains for the year to February would be hit by a slowdown in transactions following the referendum, so a fall from £51m to £35m came as no surprise.
However, looking ahead paints an altogether brighter picture, with gains for the current financial year expected to nearly double to £65-£70m, the highest level to date, and that's on existing projects alone. And there's plenty more in the pipeline. U+I has won four public/private partnership projects with a gross development value of £1.5bn. These are expected to deliver development gains of at least £90m a year in 2020 onwards.
Savings of £2m are expected to come from a reduction in net recurring overheads. Part of this will come from concentrating on a smaller number of larger schemes, rather than lower revenue generating schemes where the cost base remains relatively high.
Rather than building a bigger and bigger balance sheet, U+I continues to concentrate of redistributing excess cash back to shareholders: this was the third year in succession that a special dividend has been declared.
Analysts at Peel Hunt are forecasting adjusted net asset value (NAV) of 302p per share at the year ending February 2018, from 277p a year earlier.
U+ I (UAI) | ||||
---|---|---|---|---|
ORD PRICE: | 185p | MARKET VALUE: | £231m | |
TOUCH: | 185-190p | 12-MONTH HIGH | 202p | LOW: 140p |
DIVIDEND YIELD: | 3.2% | TRADING STOCK: | £208m | |
DISCOUNT TO NAV: | 33% | |||
INVEST PROPERTIES | £234m** | NET DEBT: | 35% |
Year to 28 Feb | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|---|
2013 | 251 | 0.8 | 2.0 | 5.6 |
2014 | 262 | 19.5 | 14.9 | 5.6 |
2015 | 276 | 34.8 | 26.8 | 5.9* |
2016 | 291 | 25.8 | 17.5 | 5.9* |
2017 | 278 | -1.7 | -2.4 | 5.9* |
% change | -4 | - | - | - |
Ex-div: 20 Jul Payment: 17 Aug *Not including special dividend of 8p in 2015 and 2016, and 2.8p in 2017, ex-div 11 May and payable on 16 Jun **Including joint ventures and associates |