Harworth's (HWG) complicated transformation from the parent company of the UK's largest coal miner to a property regeneration specialist means that direct comparison with last year's statutory results bears little relevance, littered as they are with one-off items. Crucially, underlying net assets per share rose from 93.9p a year earlier to 103.6p in the six months to the end of June - that's a discernible measure of progress.
The property portfolio comprises around 22,295 acres of former coalfield and other brownfield sites in the north of England and the Midlands across 144 sites, and management has been sifting through the various assets with a view, where appropriate, to recycling funds for reinvestment by selling ahead of book value to realise cash, raising £13.3m in the first half. It also sold 335 residential plots to regional housebuilders, with further sales expected to complete in the second half. The residential portfolio currently comprises 10,000 consented plots, with a further 5,000 going through the planning process.
On the commercial side, Harworth restricts risk and its own capital commitment by constructing forward funded sites, on which it takes a construction management fee. Two units totalling 400,000 square feet and funded by M&G are expected to be completed later this year.
Analysts at N+1 Singer are forecasting adjusted net asset value (NAV) per share of 111.1p at the 2016 December year-end.
| HARWORTH (HWG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 87.5p | MARKET VALUE: | £256m | |
| TOUCH: | 87-88p | 12-MONTH HIGH: | 141p | LOW: 70p |
| DIVIDEND YIELD: | 0.8% | TRADING PROP: | £7.6m | |
| DISCOUNT TO NAV: | 16% | |||
| INVESTMENT PROP: | £356m* | NET DEBT: | 16% | |
| Half-year to 30 Jun | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 94 | 51.3 | 2.7 | nil |
| 2016 | 104 | 7.4 | 0.3 | 0.23 |
| % change | +11 | -86 | -89 | - |
Ex-div: 3 Nov Payment: 1 Dec *Includes investment in joint ventures | ||||
