Listed property group ‘weathering the pandemic well’

Owen Michaelson

Property investment and regeneration business Harworth Group has reported revenues of £23.7m in its interim results for the half year ended 30 June 2020. (H1 2019: £58.6m).

The Rotherham-headquartered company made a £3.6m pre-tax loss compared to pre-tax profits of £18.5m for the previous period.

Acknowledging the fall in revenue, Harworth notes that half one 2019 saw an unusually high level of sales, including a significant sale at Swadlincote, with half one 2020 reflecting “a more normal level of activity”.

Harworth also says it has made further progress in disposing of its non-core portfolio, with nine sites totalling 899 acres sold in half one, to allow it to focus on key value-adding projects.

Sales totalling £30.8m were achieved, with over 70% of budgeted sales for the full year already completed or agreed, in line with previous year.

And approximately 95% of all rent due in quarter one and quarter two was collected, which Harworth says demonstrates the resilience of its portfolio.

The company’s report adds: “The underlying strength of the business has meant that no staff have needed to be furloughed and all have successfully adapted to our revised way of working and are now on an established rota system in our principal regional offices.

“Infrastructure and remediation works continued uninterrupted on all seven of our development sites where sales have been agreed, with no sales falling away as a result of the pandemic.

“We also successfully supported our housebuilders returning to site following a four to six week development pause at the height of the pandemic, with reported demand for homes on our developments now ahead of their equivalent 2019 levels.”

Harworth’s chief executive, Owen Michaelson, said: “Whilst Harworth has not been immune to the effect of COVID-19, the business is weathering the pandemic well.

“We have had an active first nine months, remaining at full operational strength throughout.

“The independent valuation as at 30 June resulted in a limited c.4.75% decline in portfolio value following the delivery of key management milestones and the Group remains well positioned for the future.

“Given our demonstrated financial and operational resilience and our long-term confidence in our business model, we are returning to paying dividends with an interim dividend per share of 0.334p, a 10% increase on our 2019 interim dividend.

“Our income portfolio continues to drive value growth whilst covering the operating costs of the business and we have continued to add to this with the acquisition of two high yielding income-producing properties in the period and on-site commercial development.

“This predominantly industrial portfolio has also performed dependably with c.95% of income collected for March and June quarters.”

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