Watkin Jones (WJG) was firing on all cylinders in the six months to March 2018, with revenue from the student accommodation side up by nearly a quarter, and a solid development pipeline of 25 sites that will deliver more than 10,300 beds. All developments for completion in the current financial year have already been sold, while of the six developments scheduled for delivery in 2019, four have been forward sold. And there are another seven projects planned for 2020, five of which already have planning consent, while one development is already forward sold.
On the accommodation side, the new owner of the Enigma portfolio of 5,124 beds has indicated that the Fresh Property Group (FPG) accommodation management part of Watkin Jones will only be required to provide reduced services, although FPG will be fully compensated for the loss of revenue.
Watkin Jones has signalled that it plans to expand its build-to-rent operation, and has entered a forward funding agreement with M&G Real Estate to deliver 315 apartments in Reading for which it will receive payment of £68.5m. In total, it now has five build-to-rent sites and expects to deliver more than 1,500 related apartments in the next five years.
Analysts at Peel Hunt are forecasting adjusted pre-tax profit for the year to September 2018 of £48.6m and EPS of 15.4p (up from £43.8 and 14.3p in 2017).
| WATKIN JONES (WJG) | ||||
| ORD PRICE: | 205.5p | MARKET VALUE: | £525m | |
| TOUCH: | 205.5-207p | 12-MONTH HIGH: | 251p | LOW: 172p |
| DIVIDEND YIELD: | 3.3% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 53p | NET CASH: | £38.4m | |
| Half-year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 134 | 21.1 | 6.7 | 2.2 |
| 2018 | 158 | 23.6 | 7.5 | 2.47 |
| % change | +18 | +12 | +12 | +12 |
| Ex-div: | 7 Jun | |||
| Payment: | 29 Jun |
