City round-up: James Fisher; Regional REIT; AJ Bell
James Fisher, the Cumbrian marine services group, has returned to an interim profit, despite a dip in turnover.
The Barrow-in-Furness-based group, which last week disposed of its Martek subsidiary in a deal worth £12.1m last week, published its six month figures to June 30, 2024, today, which revealed sales of £221.5m, down from £252m at the same point a year ago, but a return to profit in a turnaround from a £4.4m pre-tax loss in 2023, to a £200,000 pre-tax profit.
A decline in the group’s energy division was behind the 12% reduction in turnover, it said.
The board said there will be a continued streamlining of the portfolio, with year end net debt expected to be significantly reduced, as well as a focus on managing underperforming businesses.
Overall, the group said the underlying performance in the reporting period is in line with expectations.
Significant value has been realised from the sale of non-core business and assets, with aggregate cash proceeds before transaction costs of c.£100m to be realised in 2024 from sale of RMSpumptools (£82.8m), Martek (£10.6m) and remaining Subtech Europe assets (£7.1m).
The group refinancing is expected to be completed in due course, on more favourable terms and there will be targeted investment in high value growth areas across divisions.
The company said it is making continued progress on the business turn-around and the outlook for the full year remains in line with market expectations.
Chief executive, Jean Vernet, said: “We have made important strategic progress on our business turn-around this year, significantly deleveraging our balance sheet through the sale of non-core assets, to provide a stronger financial foundation for growth.
“With the full executive committee now in place, we are committed to delivering on our company priorities and I am particularly pleased to see progress on our financial foundations. We are driving a step change in our capital allocation and discipline, targeting investment in high value markets that will deliver our financial targets.”
He added: “Our focus on strengthening the supply chain will drive greater efficiency and operational excellence. This will complement a broader company self-help programme launched in June 2024 and our continued focus on underperforming businesses.
“As we enter the second half, trading in July and August was in line with expectations and the group’s full year outlook remains unchanged.
“Across all three divisions we continue to operate in supportive end markets, with a long term customer base that is evolving for the future. This provides the framework for continued delivery and through our growth pillars of people, innovation and targeted geographical growth, we will drive the second phase of our business turn-around.”
::
Stephen Inglis
Regional REIT, the property firm with offices in Old Trafford overseeing properties throughout the North West, said the regional office market appears to be reaching an inflection point, with the recent cut to the base rate providing a helpful development.
It announced interim figures for the six months to June 30, 2024, today, which it said reflected another “challenging period”.
The portfolio valuation stood at £647.9m, compared with £700.7m at December 31, 2023. On a like-for-like basis, the portfolio value reduced by 5.1% during the period, after adjusting for disposals and capital expenditure.
Rent collection remained strong over the period at 98%, against the equivalent period for June 30, 2023 at 98.8%.
The rent roll stood at £63.5m, three per cent lower on a like-for-like basis.
The group’s weighted average cost of debt continued to remain low at 3.5% (31 December 2023: 3.5%).
Operating profit, before gains and losses on property assets and other investments for the six months ending June 30, 2024, amounted to £19.1m (June 30, 2023: £20.6m).
The company has declared it will pay a dividend of 2.20 pps for the period April 1, 2024 to June 30, 2024.
Stephen Inglis, CEO of London and Scottish Property Investment Management, the Asset Manager, said: “The period under review was another challenging period for the commercial real estate sector, with valuations reduced by persistently high interest rates and poor investor sentiment towards UK commercial real estate.
“However, the regional office market appears to be reaching an inflection point, with the recent cut to the base rate providing a helpful development.”
He added: “Post-period end, we repaid in full our 4.50% £50m retail bond, which we were able to achieve following a £110.5m capital raise in July.
“This also provides us with the opportunity to reduce the company’s borrowings with the LTV reducing to 42% and we continue to make efforts to reduce the LTV further to the long term target of 40%.
“The raise also provides greater flexibility for capital expenditure to improve the core assets in our portfolio and increase shareholder value going forward.”
::
Roger Stott
AJ Bell, the Manchester-based investment platform with omore than half a million customers, announced that Chief Operating Officer, Roger Stott, will be retiring and stepping down as an Executive Director on December 31, 2024.
He joined AJ Bell in July 2008 and during his time at the company has held a range of roles including Group Finance Director and Chief Risk Officer.
He was appointed to the board in the newly-created role of COO in August 2021, taking responsibility for the operational aspects of the business.
Chief Financial Officer, Peter Birch, and Chief Technology Officer, Mo Tagari, will assume the FCA Senior Manager Function responsibilities of the Chief Operations Function (SMF 24) subject to regulatory approval.
Peter continues to serve on the board as an Executive Director having been appointed as CFO in 2022.
Fiona Clutterbuck, Chair of AJ Bell, said: “On behalf of the board, I wish to thank Roger for his outstanding contribution to the board and the company over many years and wish him well for the future.
“During his time with the company, Roger has played a significant role in the success of the business.”
