A sharp devaluation in the development portfolio, combined with reduced sales of serviced land, pushed Harworth (HWG) into a pre-tax loss during the first half of the year. However, that has not deterred management from adding to its pipeline of assets, including the signing of a Planning Promotion Agreement for a major new residential development in the West Midlands. “We are not rushing to buy at the moment because we think there could be some distress coming through the market,” said outgoing chief executive Owen Michaelson.
Encouragingly, land sales were made at three sites either at or above book value at the end of December, resulting in 70 per cent of budgeted strategic land sales being completed or agreed. The income-producing side of the portfolio, which covers all operating and finance costs associated with the group, also put in a robust performance. Around 95 per cent of rent due for the March and June quarters was collected from the predominantly industrial portfolio.
House broker Peel Hunt forecasts an adjusted NAV of 146p a share at the end of December, rising to 156p the same time the following year.
| HARWORTH (HWG) | ||||
| ORD PRICE: | 90.4p | MARKET VALUE: | £ 291m | |
| TOUCH: | 90.4-91.8p | 12-MONTH HIGH: | 160p | LOW: 84p |
| DIVIDEND YIELD: | 0.0% | TRADING PROP: | £14.4m | |
| DISCOUNT TO NAV: | 36% | |||
| INVESTMENT PROP: | £331m | NET DEBT: | 16% | |
| Half-year to 30 Jun | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2019 | 141 | 18.5 | 4.7 | 0.304 |
| 2020 | 142 | -3.6 | -1.6 | 0.334 |
| % change | +1 | - | - | +10 |
| Ex-div: | 15 Oct | |||
| Payment: | 13 Nov |
