Harworth Group Plc · LSE:HWG
Harworth — Investor Presentation (September 2023)
25 slides from Harworth's investor presentation, Sep 28, 2023
Slide 1: Investor Meet Company Presentation
Investor Meet Company Presentation 28 September 2023 www.harworthgroup.com Image: Cadley Park, Derbyshire Harworth Group plc | Investor Meet Company Presentation
Slide 2: Agenda
Agenda 1. Introduction 2. Financial review 3. Operational review 4. Outlook & conclusion 5. Q&A Harworth Group plc | Investor Meet Company Presentation 2
Slide 3: A long-term, through-the-cycle business
A long-term, through-the-cycle business We invest to transform land and property into places where people want to live and work Structurally Strong Unique Extensive Responsible undersupplied financial skillset landbank business markets position Unrivalled expertise as Potential GDV of £2.4bn 57% of
Slide 4: H1 2023 overview
H1 2023 overview (Six months to 30 June 2023) Management actions drove Resilient industrial & logistics Well positioned, with strong uptick in valuations and resilient market, growth in BTR, but balance sheet, low LTV and EPRA NDV performance some housebuilder headwinds significant available liquidi
Slide 5: Market in line with long term average
Industrial & logistics Market in line with long term average Take-up of industrial & logistics space corrects to pre-Covid levels in H1 Supply responds, with speculative building moving closer to pre-Covid levels 60 7 6 50 5 Speculative development (m sq. ft) 40 4 Take-up (m sq. ft) 30 3 20 2 10 1 0
Slide 6: Planning headwinds but growth in BTR
Residential Planning headwinds but growth in BTR Planning system a growing constraint for housebuilders BTR market in good health, with regional growth outpacing London % major planning applications decided within 13-week statutory time limit 40,000 60 50 35,000 Number of BTR homes under constructio
Slide 7: Progressing our growth strategy
Progressing our growth strategy Growth drivers 2015 - 2021 2022 H1 2023 Ambition by 2027 1. Increasing direct 1.4m sq. ft 110,000 sq. ft developed 800,000 sq. ft development of industrial developed over 432,000 sq. ft developed developed on average & logistics space On-site with 166,000 sq. ft, five
Slide 8: Financial review
Financial review Kitty Patmore Chief Financial Officer Harworth Group plc | Investor Meet Company Presentation
Slide 9: Revenue driven by rental income and land sales
Revenue driven by rental income and land sales Revenue in line with historical levels; H1 2022 included a Income statement (£m) H1 2023 H1 2022 FY 2022 large development property land sale Revenue 18.2 62.6 166.7 98% of budgeted sales for 2023 now completed, Gross profit(1) 8.6 25.5 83.4 exchang
Slide 10: EPRA NDV broadly stable at 195.7p per share
EPRA NDV broadly stable at 195.7p per share Modest uptick in valuations and a Balance sheet (£m) 30 June 2023 30 June 2022 31 Dec 2022 broadly stable EPRA NDV: Property portfolio(1) 700.3 800.0 695.4 a small increase in the valuation of Investment properties (within the Trade receivables & other
Slide 11: EPRA NDV per share bridge (p)
EPRA NDV per share bridge (p) 2.3 (1.3) (0.7) 196.5 (0.5) (0.9) 0.3 195.7 31 Dec 2022 Value Gains/(losses) Loss Excluding Value Interest & Finance Costs Tax Dividend Other (pension, swap, 30 Jun 2023 Gains dilution etc) Harworth Group plc | Investor Meet Company Presentation 11
Slide 12: Management actions drive uptick in valuations
Management actions drive uptick in valuations Residential: stable market, as H1 2023 H1 22 30 June 31 Dec supply remained constrained and £m Total 2023 2022 house prices were maintained. For Profit/(loss) Revaluation Total value value Portfolio Portfolio on sale(1) gains/(losses)(2) gains/(losses)
Slide 13: Significant latent value in portfolio
Significant latent value in portfolio Natural Industrial & logistics Strategic land: Resources residential Agriculture & other £56m | 21,348 plots Residential Industrial Residential & logistics (£/plot) (£/sq. ft) Investment Portfolio £240m | 2.9m sq. ft Investment Income Portfolio £82 generation 36
Slide 14: Net debt of £63.7m with £155.0m headroom
Net debt of £63.7m with £155.0m headroom Net debt movement (£m) RCF RCF Headroom Headroom 155.0 164.0 3.0 3.9 (52.5) 8.5 4.1 2.1 12.0 34.2 Cash: 8.5 Cash: 11.6 63.7 48.4 31 Dec 22 Development spend Acquisitions Loss excluding value Interest and finance Tax Dividends Cash and working Sales proceeds 3
Slide 15: Net loan to portfolio value remains low at 8.6%
Net loan to portfolio value remains low at 8.6% Target year-end net loan to portfolio value of <20% with a maximum of 25% Gearing overview 30 June 2023 30 June 2022 31 Dec 2022 in year Net debt (£m) 63.7 67.8 48.4 Weighted average cost of debt was 6.2%, with a 0.94% non-utilisation fee on undraw
Slide 16: Operational review
Operational review Lynda Shillaw Chief Executive Harworth Group plc | Investor Meet Company Presentation
Slide 17: Potential to deliver 7.3m sq. ft of space
Industrial & logistics land portfolio Potential to deliver 37.3m sq. ft of space H1 2023 highlights Main industrial & logistics sites (30 June 2023) Completed 110,000 sq. ft of Grade A space at Gateway 36 in Barnsley: 39,000 Name Sold or developed / Estimated GDV Completion sq. ft already let, wit
Slide 18: Potential to deliver 28,359 new homes
Residential land portfolio Potential to deliver 28,359 new homes H1 2023 highlights Main residential sites (30 June 2023) 92% of budgeted 2023 plot sales completed, exchanged or in heads of terms Name Plots sold / consented or planned Completion date 1 Waverley 2,442 / 3,038(1) consented 2025 Pr
Slide 19: Progressing mixed tenure portfolios
Residential land portfolio Progressing mixed tenure portfolios Single-family Affordable Net Zero Carbon Senior Built-to-Rent Housing homes living Progressing towards Launched in Planning Exploring options to exchange April 2023 applications being integrate into prepared for small- residential sites
Slide 20: Accelerating Grade A transition with £70m of sales
Investment Portfolio Accelerating Grade A transition with £70m of sales Six disposals so far this year, of Disposal locations sites where value has been maximised through asset management and development All sales were in line with December 2022 valuations A broad range of buyers, including oc
Slide 21: Strong occupational market
Investment Portfolio Strong occupational market Sector breakdown (30 June 2023) Key stats 30 June 2023 31 Dec 2022 Number of sites 14 19 Online Retail Other Total area 2.9m sq. ft 4.0m sq. ft 3% 13% Manufacturing 42% Annualised rent roll £15.8m £19.7m Automotive £15.8m Gross yield 6.6% 7.0% 9% Net i
Slide 22: Outlook
Outlook We are a long-term through-the-cycle business: unique skillset, extensive landbank, focused on structurally undersupplied sectors and with a strong financial position UK economic outlook likely to remain challenging in the near term, but encouraging signs that inflationary pressures are
Slide 23: Q&A
Q&A Harworth Group plc | Investor Meet Company Presentation
Slide 24: Disclaimer
Disclaimer For the purpose of the following disclaimer, reference to this ‘presentation’ shall be deemed Actual results may differ materially from those expressed in forward-looking statements. As to include reference to the presentation slides, the presenters’ speeches, the question and such, you a
Slide 25: Harworth Group plc
Harworth Group plc Head Office Birmingham Manchester Leeds Advantage House Waterloo House 6th Floor, Trinity 3rd Floor Poplar Way 20 Waterloo Street 16 John Dalton Street Nine Bond Court Rotherham Birmingham Manchester Leeds S60 5TR B2 5TB M2 6HY LS1 2JZ www.harworthgroup.com Harworth Group plc | In
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