Improving picture for St Modwen
DEVELOPER St Modwen has reported a 32% increase in half-year pre-tax profit.
In the six months to May 31, the firm said profits were up to £51.3m from £38.8m.
Realised property profits were also up at £19.1m (H1 2013: £16.1m).
St Modwen launched a £100m convertible bond in February and refinanced its debt portfolio, extending the average life to 4.2 years (Nov 2013: 2.5 years).
It also reduced the weighted average cost of debt to 5.1% (Nov 2013: 5.6%). St Modwen suggests it is benefiting from its major projects gathering momentum and growth in the commercial property sector. Its increasing commercial development pipeline across the UK reflects the gradual, overall improvement of this market, it says.
In the North West St Modwen is working with Persimmon on a supermarket and 282 homes at the former Vulcan Works in Newton-le-Willows, and the £150m Great Homer Street regeneration scheme in Liverpool. The group also has a £20m town centre plan for Skelmersdale and owns Wythenshawe Shopping Centre, Manchester.
Chief executive Bill Oliver said: “Against a backdrop of improving optimism across the country, we are prudently increasing our pipeline of development activities and actively pursuing new opportunities to meet growing investor interest and occupier demand.
“Whilst we are still some way from a wholesale UK recovery, confidence is starting to return to the regions.
“Here our traditional engine of growth, commercial development, is beginning to gain momentum with over 1m sq ft of regional commercial projects in progress. This, combined with our improving valuations particularly in the residential sector, underpin our confidence for continued outperformance as we work towards the full year.”
