TIDMSMP
RNS Number : 3488H
St. Modwen Properties PLC
03 December 2020
Date of issue: 3 December 2020
LEI: 213800WMV4WVES8TQH05
ST. MODWEN PROPERTIES PLC
("St. Modwen" or "the Company")
Trading update for the period ended 30 November 2020
Strong operational performance underpins meaningful growth
opportunities
Sarwjit Sambhi, Chief Executive Officer of St. Modwen,
commented:
"St. Modwen has delivered strong operational results in 2020 and
our underlying performance has been in line with the Board's
expectations. I would like to take this opportunity to thank all my
St. Modwen colleagues and our partners for delivering this
performance, under extraordinary circumstances. While the near-term
economic outlook remains uncertain, momentum has continued to
build, so with a strong forward order book in housebuilding,
sustained demand for industrial and logistics space and a solid
capital base, St. Modwen is well positioned going into 2021. I look
forward to updating the market further at our full year results
presentation in February."
Update on current trading
In Industrial & Logistics, we completed 1.2m sq ft of
developments during the year (2019: 0.9m sq ft), as indicated at
our half year results. We continue to see good customer demand, so
78% of the GBP7.5m ERV associated with our 2020 completions is
already let or under offer, which is well ahead of the 53% of our
2019 pipeline this time last year. We are continuing to target the
delivery of at least 1.5m sq ft in 2021 and are already on site
with the majority of these schemes. Our 18m sq ft overall pipeline
provides a significant opportunity to further accelerate
development beyond 2021 and, reflecting this, we recently agreed to
deliver a c. 200,000 sq ft build-to-suit development in 2022.
In St. Modwen Homes, we have sold 948 units (2019: 1,060).
Demand has remained strong, with an average sales rate of 0.92
since May, so this reduction in volume solely reflected the c. 9-10
weeks of lost production in Spring when we temporarily closed our
sites during lockdown. Completed sales in the second half were up
3% compared to the second half of 2019, despite the impact of
social distancing on production in June and July, and we have seen
a c. 2% improvement in like-for-like pricing since the half year.
Operating margins improved in the second half, as expected,
although margins for the full year are c. 2.5ppt below last year
(2019: 14.8%) due to the closure of our sites in Spring. We have
continued to operate our sites and sales offices safely over the
past month, in line with Government guidance. Our private forward
order book is strong at 368 units (GBP99m), up 53% vs this time
last year. Should current conditions persist, we would therefore
expect volumes to grow by up to 25% and margins to recover
substantially in 2021. Despite the challenging environment, our
accident frequency rate has remained at one-tenth of the industry
average and our HBF customer satisfaction rating continues to track
over 95%, supporting our 5* rating.
In Strategic Land & Regeneration, we have continued to
monetise the value in our existing portfolio and have agreed a
revision of the NCGM development agreement, which unlocks GBP25m of
cash (our share) held in the JV's development account. A change in
discount rate of our share of the JV's development obligations will
result in a non-cash financial charge of GBP10m (4.5 pence per
share) in our 2020 results, but this charge is fully offset by a
similar reduction in non-cash financing cost in the next few
years.
Disposals
Since the publication of our half year results in July, we have
sold or exchanged contracts for the disposal of a further GBP96m of
assets. This includes GBP20m of non-core SL&R assets,
comprising 11 small office, PRS, retail and other commercial
assets; GBP50m of SL&R residential land, including GBP8m at
Llanwern, South Wales; and GBP26m of I&L assets, comprising
three old industrial assets plus eight individual units and small
land plots. On average, these disposals were in line with their May
book value. In total, this brings disposals for the year to
GBP154m, including GBP93m of surplus residential land (2019:
GBP30m).
Rent collection
In Industrial & Logistics, we have collected 97% of the rent
due in the March and June quarters and, so far, 87% of the rent due
in September, which is in line with the same time last quarter. In
Strategic Land & Regeneration, where over half of our income
comprises our residual retail assets, we have collected 86% of the
rent due in the March and June quarters and, so far, 67% of the
rent due in September, which marks an improvement compared to this
time last quarter. As a result, our overall rent collection for the
March and June quarters is 93%, up from 77% at the time of our half
year results in July, with rent collection for the September
quarter at 80% so far. We have agreed to waive 1% of the overall
rent due during these quarters and continue to work closely with
our customers in securing the remainder.
Balance sheet and liquidity
Reflecting significant disposals and tight cost control,
see-through net borrowings have reduced from GBP395m at the end of
May to GBP277m at the end of November (2019: GBP291m). This leaves
GBP288m of headroom under our existing facilities, while none of
our Group debt matures until December 2023. These numbers exclude
the GBP25m of cash in our NCGM JV, which will benefit net
borrowings as of December 2020.
Full year results
The Company intends to announce its results for the full year on
9 February 2021, including its final 2020 dividend. Based on
current trading conditions, the Board envisages this to be in line
with our standard policy to pay out c. 50% of adjusted EPRA EPS as
dividend.
- ENDS -
Enquiries:
St. Modwen Properties PLC
Sarwjit Sambhi, Chief Executive Officer Tel: 0121 222 9400
Rob Hudson, Chief Finance and Operations Officer www.stmodwen.co.uk
Tom Gough, Head of Corporate Affairs
FTI Consulting
Dido Laurimore Tel: 020 3727 1000
Andrew Davis stmodwen@fticonsulting.com
This announcement contains certain forward-looking statements.
Forward-looking statements can be identified by the use of
forward-looking terminology, including the terms "believes",
"estimates", "anticipates", "expects", "intends", "plans", "goal",
"target", "aim", "may", "will", "would", "could" or "should" or, in
each case, their negative or other variations or comparable
terminology. These forward-looking statements include all matters
that are not historical facts. Forward-looking statements by their
nature, involve risk and uncertainty because they relate to future
events and circumstances. Actual outcomes and results may differ
materially from any outcomes or results expressed or implied by
such forward-looking statements. Any forward-looking statements
made by or on behalf of the Company are made in good faith based on
the information available at the time the statement is made; no
representation or warranty is given in relation to them, including
as to their completeness or accuracy or the basis on which they
were prepared. The Company does not undertake to update forward
looking statements to reflect any changes in its expectations with
regard thereto or any changes in events, conditions or
circumstances on which any such statement is based. Nothing in this
announcement should be construed as a profit forecast.
The person responsible for arranging the release of this
information on behalf of the Company is Sarwjit Sambhi, Chief
Executive.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTFSFFAEESSEEE
(END) Dow Jones Newswires
December 03, 2020 02:00 ET (07:00 GMT)
St.modwen Properties (LSE:SMP)
Historical Stock Chart
From Apr 2024 to May 2024
St.modwen Properties (LSE:SMP)
Historical Stock Chart
From May 2023 to May 2024