Property investment boosts results for Yorkshire group
COALFIELD Resources, which has a significant investment in Harworth Estates Property Group, has boosted profits and increased net assets.
The Doncaster-based business, which has 24.9% stake in Yorkshire property group Harworth Estates, today reported profit from continuing operations up to £3.3m from £0.3m and net assets of £55.2m compared to £47.9m in the previous year, as it announced its final results for the year ended December 28 2013.
Coalfield Resources was, until December 2012, the parent company of the UK’s largest coal miner, UK Coal. In one of the most complex restructuring in UK corporate history, Coalfield Resources, which was previously known as UK Coal, split its operating business into two separate units – property and mining – and gifted 75% of the property business to the trustees of the mining business pension fund.
At the same time, it relinquished control of the coal mining operations to an Employee Benefit Trust, retaining only a minority equity stake which ranked behind the debt owed to the pension funds.
Today, the group said Harworth Estates, which is behind the mixed-use community at a former Prince of Wales Colliery site in Pontefract, has performed strongly in its first year of trading as an independent property development company.
Net assets at Harworth Estates increased to £235m, from £222m, on a property portfolio value of £278m (2012: £260m). Pre-tax profit came in at £12.9m.
Harworth Estates, owns and managing around 31,370 acres across some 200 projects, with consent for 8,000 new homes.
Chairman of Coalfield Resources, Jonson Cox, said: “Following the insolvency and further restructuring of the mining business in July 2013, Coalfield Resources’ sole focus has been its role as active investor in Harworth Estates. While we have a minority holding, we are working closely with the majority Pension Fund investor to drive value for all shareholders.
“Harworth Estates had a strong first year of trading as an independent property development company, generating a net 6% increase in net asset value to £235m, repaying £22m of its inherited bank debt and investing £10m in its land assets. While we are aware of the challenges inherent in moving forward from our mining heritage, the board o remains confident of the ability of Harworth Estates to deliver and grow shareholder value.”
Looking ahead, Cox said: “We have seen a recovery of interest in the property sector in the last 12 months. Harworth Estates is a beneficiary of this, through the increased demand and improved prices for commercial and residential land. This can be seen in both the valuation gains it has achieved and also the disposals it has made. Notwithstanding the challenges inherent in moving forward from its mining heritage, the board is confident of the ability of our underlying asset, Harworth Estates, to deliver and grow shareholder value from the redevelopment of the former coalfields and other former industrial sites.”
