Urban & Civic (UANC) is set to exceed its annual completion target after selling 365 residential plots during the first-half. With a further 335 sales expected at the Europa Way site in Warwick, the master-developer is aiming to complete 970 plots in 2019. The reclassification of the Grange Farm site from investment to trading stock – prior to a planning application being submitted – depressed pre-tax profits.
Fewer licences were written than plots sold, which meant the large site discount – calculated by applying a wholesale discount to the open-market value of its standard residential land – rose by more than half and added 139p a share to the brownfield developer’s adjusted net asset value.
With the company receiving around a third of the sale value from housebuilders, weakening price growth may present a challenge. Chief executive Nigel Hugill said its most recent licences are written with a guarantee of 93 per cent of the sale price, which provides some insulation from slowing growth. “Secondly the construction cost inflation for us is a lot lower,” he added.
Analysts at broker Stifel expect adjusted net assets of 368p a share at the September 2019 year-end, up from 332p at the same time last year.
| URBAN & CIVIC (UANC) | ||||
| ORD PRICE: | 326p | MARKET VALUE: | £ 473m | |
| TOUCH: | 323-326p | 12-MONTH HIGH: | 348p | LOW: 257p |
| DIVIDEND YIELD: | 1.1% | TRADING PROP: | £321m | |
| PREMIUM TO NAV: | 20% | |||
| INVESTMENT PROP: | £160m* | NET DEBT: | 23% | |
| Half-year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 263 | 10.1 | 6.2 | 1.3 |
| 2019 | 271 | 5.1 | 2.7 | 1.4 |
| % change | +3 | -50 | -56 | +8 |
| Ex-div: | 06 Jun | |||
| Payment: | 12 Jul | |||
| *Includes investments in joint ventures | ||||
