Growing pressure on rental income for retailers and an increase in the development risk for housebuilders meant the value of St Modwen’s (SMP) strategic land and regeneration assets declined by around a quarter during the first half, which drove the group’s net asset value down 11 per cent.
The housebuilding operations suffered a fall in the operating margin to 10.7 per cent, from 14.8 per cent, as completions fell almost a third due to lockdown. While the average sales rate since the end of March has improved to 0.8 and sales prices remained stable, management does not expect to make-up for lost volumes during the second half.
Industrial and logistics assets - which now account for almost half of the portfolio - were a brighter spot. It has now received 86 per cent of the rent due in June and 95 per cent of that due in March, although estimated rental values still moved down marginally.
Panmure Gordon forecasts an adjusted NAV of 541p a share at the end of November, rising to 574p the same time the following year.
| ST MODWEN PROPERTIES (SMP) | ||||
| ORD PRICE: | 345p | MARKET VALUE: | £ 767m | |
| TOUCH: | 344-346p | 12-MONTH HIGH: | 539p | LOW: 296p |
| DIVIDEND YIELD: | 1.8% | TRADING PROP: | £26.3m | |
| DISCOUNT TO NAV: | 18% | |||
| INVESTMENT PROP: | £936m | NET DEBT: | 44% | |
| Half-year to 31 May | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2019 | 476 | 35.6 | 10.5 | 3.6 |
| 2020 | 423 | -151 | -60.5 | 1.1 |
| % change | -11 | - | - | -69 |
| Ex-div: | 06 Aug | |||
| Payment: | 02 Sep |
