TIDMHWG
RNS Number : 6563Z
Harworth Group PLC
25 May 2021
25 May 2021
Harworth Group plc
("Harworth" or the "Company")
AGM Trading Update
A strong start to 2021 as demand for serviced land and
industrial units remains robust
Harworth Group plc, a leading regenerator of land and property
for development and investment, will hold its Annual General
Meeting at 2pm today. Given that some restrictions on gatherings
and social distancing requirements remain in place, shareholders
are requested not to attend the AGM in person. The Company provides
the following update on its operational performance and will
announce the results of the AGM later today.
Lynda Shillaw, Chief Executive of Harworth, commented: "Harworth
has made a strong start to 2021, as we continue to progress our
pipeline totalling 30,668 housing plots and 26.1 million sq ft of
commercial space. Demand for our serviced land and industrial units
has been robust so far this year, and we continue to progress
planning applications across our Strategic Land portfolio,
including our 1,000-home mixed-use development at Ironbridge, which
secured the first of its two required planning approvals last week.
With a powerful sense of purpose, a strong balance sheet and
substantial high-quality development pipeline, we are
well-positioned to deliver growth over the remainder of the
year."
Residential pipeline
Our residential pipeline comprises 9,473 consented housing plots
across our Major Development sites and the potential for a further
21,195 housing plots across our Strategic Land sites, of which
2,418 are in planning and awaiting determination. We continue to
identify acquisition opportunities to add to our pipeline and drive
future growth.
Our largest residential development currently in the planning
system is in Ironbridge, Shropshire, where we have plans to
regenerate the former Ironbridge Power Station into a mixed-use
development comprising 1,000 new homes, alongside a range of
commercial, leisure and community uses. Last week, we secured
planning approval from Telford & Wrekin Council, one of the two
councils determining the application, and we expect to receive a
decision from the other, Shropshire Council, early in the
summer.
Across our Major Development sites demand for our serviced
residential plots remains strong, with 54% of budgeted residential
plot sales for this year either completed, exchanged, or in heads
of terms, ahead of both our expectations and our progress at the
same point last year. This includes our recent exchange on the sale
of 16.2 acres to Taylor Wimpey for the delivery of 258 new homes at
Moss Nook in St Helens, Merseyside, our first residential
development in the North West.
At Waverley, South Yorkshire, we are progressing the planning of
Olive Lane, a new heart of the community for over 2,500 residents
now living at the development and over 2,000 workers at the
Advanced Manufacturing Park ("AMP"). The proposals include a
supermarket, restaurants and cafes, a medical centre, and offices,
alongside additional residential development, all of which will
create a vibrant centre for local people. We expect to submit a
planning application for Olive Lane later this summer.
Industrial & Logistics pipeline
Our industrial & logistics pipeline comprises 7.9 million sq
ft of consented space across our Major Development sites, and the
potential for an additional 18.2 million sq ft across our Strategic
Land sites, of which 4.2 million sq ft is currently in planning
awaiting determination.
One of our largest industrial & logistics developments
currently in the planning system is for 1.1 million sq ft of
commercial space at our site in Wingates, Greater Manchester. The
site is strategically located adjacent to Junction 6 of the M61 and
in close proximity to Harworth's existing Logistics North site. We
expect to receive a decision on our application in the second half
of 2021. Elsewhere in our Strategic Land portfolio, we have
continued land assembly works at our site in Ansty, Warwickshire,
with the purchase of a 128-acre land parcel in January for GBP3.0
million. Once land assembly works are complete, we intend to submit
a planning application for over 3.0 million sq ft of prime
logistics space at the site, which is adjacent to Junction 2 of the
M6 and the M69.
Across our Major Development sites, we are continuing the direct
development of small-scale units and the sale of land plots for
development, with 72% of budgeted industrial & logistics land
sales for this year either completed, exchanged, or in heads of
terms. Our development strategy includes the construction by
Harworth of a 50,800 sq ft unit at Logistics North, which reached
practical completion last week, and of 52,000 sq ft of
manufacturing space across two units at the AMP in Waverley, which
is due to commence shortly. At our site in Bardon Hill,
Leicestershire, where we have outline planning consent for up to
350,000 sq ft of commercial space, we intend to commence the direct
development of the first industrial units this summer. Elsewhere at
the AMP, we sold a parcel of land to premium sportswear
manufacturer, SBD Apparel, for the construction by Harworth of a
new 100,000 sq ft facility, allowing SBD Apparel to consolidate its
operations into a single site and increase its manufacturing
output.
Income Generation portfolio
Our Income Generation portfolio mainly comprises industrial
Business Space and Natural Resources assets, providing a recurring
rental income that covers our administrative expenses, finance
costs and tax, in addition to asset management opportunities and
the potential for capital value growth. So far in 2021, rent
collection across our Business Space portfolio remains high at 98%,
reflecting the strength of our diverse occupier base.
In April we acquired Towngate Business Park, Widnes for GBP12.7
million, reflecting a net initial yield of 7.1% and a reversionary
yield of 9.4%. The asset provides 262,000 sq ft of fully-let
industrial space across nine-industrial units, with easy access to
the M62.
We continue to pursue opportunities to churn this portfolio,
selling mature assets where we have completed asset management
initiatives and recycling the proceeds into higher yielding
opportunities where we can extract growth through active asset
management and small-scale development.
Strong balance sheet and financial position
Harworth remains well-capitalised and we continue to manage our
cashflows sustainably. As at 30 April 2021 we had net debt of
GBP94.0 million (31 December 2020: GBP71.2 million), and a
pro-forma LTV of 14.7% (31 December 2020: 11.5%), based on 31
December 2020 valuations. This continues to provide significant
headroom and flexibility.
The Harworth Way
As a leading master developer and regenerator, strong
Environmental, Social and Governance ("ESG") credentials are
central to Harworth's purpose and are encapsulated in "The Harworth
Way". We have made significant progress in this area and, in April,
we established an ESG Committee of the Board chaired by Angela
Bromfield, our Senior Independent Director, to provide oversight,
on behalf of the Board, in relation to the Group's ESG strategy,
reporting, and activities. A particular focus for the Committee in
the coming year will be the setting of appropriate ESG targets
across our business, and enhancing the collection, monitoring and
disclosure of the relevant data.
For further information
Harworth Group plc
Lynda Shillaw (Chief Executive) T: +44 (0114) 349 3131
Kitty Patmore (Chief Financial Officer) E: investors@harworthgroup.com
Tom Loughran (Head of Investor & Stakeholder
Relations)
FTI Consulting
Dido Laurimore T: +44 (0)20 3727 1000
Richard Gotla E: Harworth@fticonsulting.com
Eve Kirmatzis
About Harworth
Listed on the Premium Segment of the Main Market, Harworth Group
plc (LSE: HWG) is a leading sustainable regenerator of land and
property for development and investment which owns, develops and
manages a portfolio of approximately 16,000 acres of land on around
100 sites located throughout the North of England and Midlands. The
Group specialises in the regeneration of large, complex sites, in
particular former industrial sites, into new residential
developments and employment areas ( www.harworthgroup.com ).
LEI: 213800R8JSSGK2KPFG21
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