Aim-listed planning specialist Inland Homes (INL) enjoyed a very fruitful first half, selling 355 consented building plots for £15.4m and 15 new homes for an additional £3.1m. Chief executive Stephen Wicks says its success had more to do with the timing of permissions and sales - the prior year was a somewhat barren one - than the government's attempts to unblock the planning system. "It's got no easier to get planning permission - quite the contrary," he says.
The company's net assets swelled 4.7 per cent to £51.7m as the cash rolled in from sales. But that substantially understates its underlying value since the 1,931 residential plots are held on the balance sheet at cost. It also excludes likely gains from Drayton Garden Village, a venture with the Ministry of Defence from which Inland is due to receive at least 5p a share in development profits.
In time, Mr Wicks wants to turn the company into a more conventional housebuilder by developing homes on a higher proportion of its consented plots. He expects Inland to build 300-400 homes a year, with 200 due to be under construction by June. The cash generated will be used to buy more plots in the South East, particularly from the cash-strapped Ministries of Defence and Health and from book-cleansing banks.
Broker finnCap has upgraded its adjusted EPS forecast for the year to end-June 2013 from 1.5p to 1.8p (from 0.4p in 2012).
INLAND HOMES (INL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 27.8p | MARKET VALUE: | £50.9m | |
| TOUCH: | 27.5-28p | 12-MONTHHIGH: | 32p | LOW: 16p |
| DIVIDEND YIELD: | 0.2% | TRADING PROP: | £36m | |
| DISCOUNT TO NAV: | 1% | |||
| INVESTMENT PROP: | £8.8m | NET DEBT: | 10%* | |
| Half-year to 31 Dec | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 27.0 | 1.08 | 0.43 | nil |
| 2012 | 28.2 | 3.05 | 1.30 | nil |
| % change | +4 | +182 | +202 | - |
Ex-div: - Payment: - *Includes preference shares and deferred consideration | ||||
