Springfield Properties Share Discussion Threads

[alan@bj] 21/2/2024 09:14

A strong recommendation yesterday from Investors Chronicle, which cites three reasons for optimism and ends, "On this basis, the shares are priced on a forward price/earnings (PE) ratio of 9.4 as well as 46 per cent below book value estimates of 141p – a harsh rating given green shoots of recovery. Buy."

[scotches] 20/2/2024 08:30

SPRINGFIELD Properties has raised £8.7 million from the sale of around 11.2 acres of land as it continues to chip away at its debt.

And it said it was in “advanced” talks with regard to further sales.

The deal is the latest in a series of land sales executed by the Highland housebuilder to raise cash since embarking on a strategy to shore up its balance sheet in September, when it suspended dividends as interest rates rose and mortgages were becoming more expensive. The company has now raised more than £18m from land sales since October.

[18bt] 20/2/2024 07:16

Looks like deep value here if they can deliver on their promises for H2. Nascent signs of house price recovery as reported elsewhere. Rising earnings growth above inflation for those in work will help multiples even as the SNP’s tax increases neutralise some of the effect in Scotland.

[edmonda] 20/2/2024 07:13

Interim Results - "Looking to the future with confidence"

New research report with audio summary here:

Springfield has reported encouraging H1 results, reiterating full year expectations and confidence in longer term growth prospects. The strategy to maximise cash generation is bearing fruit, costs are being carefully controlled and there are signs of market recovery, both in terms of Affordable contract successes and, more recently, a pick-up in Private Housing activity since mid-January. It is too early to extrapolate but the average weekly reservation rate in Private Housing since mid-January has been 62% higher than for the year to that point

Debt reduction is a clear priority for management and today’s results highlight the progress that has been made in realising cash from the land bank in recent periods. Springfield has one of the largest land banks in Scotland and an excellent reputation in both Private and Affordable Housing.

With increasing confidence in forecasts and improving market sentiment, we believe the 40%+ discount to sector peers is unwarranted and reiterate our ED Fair Value/Share of 130p (Price/ Book multiple of c.1.0x).

[spob] 07/2/2024 21:34

Should lift the whole sector

[alan@bj] 07/2/2024 09:05

I wonder if Barratt's £2.5bn offer for Redrow will give these a slight lift?

[18bt] 06/2/2024 08:22

Another useful contract

[swiss paul] 08/1/2024 19:14

Housebuilder Stewart Milne Group has entered administration with the immediate loss of more than 200 jobs.

The construction firm, based in the north-east of Scotland, said it faced "significant challenges" since the pandemic.

However, two bids for the business, including one from former chairman Stewart Milne, were rejected by the firm's bank.

Administrator Teneo said 217 jobs would be affected.

Six of the company's subsidiaries have also been placed into administration, but its north-west England arm has not.

Hundreds of other sub-contractor roles could be hit by the collapse.

[davebowler] 23/12/2023 12:25

htTPs://www.stockomendation.com/tips/19-dec-23-russ-mould-the-telegraph-questor-hold-spr-springfield-properties

[alan@bj] 21/12/2023 08:54

A report in The Times today headed “Resilient house prices defy dire forecasts” draws from the ONS figures on housing sales to the end of October. One paragraph states, “Prices fell more sharply in Wales in the year to October, sliding by 3 per cent to an average of £214,000, according to the statistics office. By contrast, the average house price in Northern Ireland and Scotland rose by 0.2 per cent to £191,000.”

[1ups1de] 20/12/2023 10:46

Still a steal @under£1. Improving 24 macros ( interest rates / inflation); sensible debt reduction programme rather than dividend;significant housing supply constraints; substantial land bank undervalued.

[spob] 19/12/2023 20:47

thanks for that

[value hound] 16/12/2023 18:57

Note from Equity Dev't FWIW:

"With increasing visibility of profit recovery and cash generation, we increase our ED Fair Value per share to 130p (from 110p) based on a sector average Price/ Book multiple of 1.0x."

www.equitydevelopment.co.uk/research/increasing-confidence-debt-reduction-on-track?

[spob] 14/12/2023 11:56

Can't ever see house prices falling that much in Scotland. Much more affordable relative to incomes than they are down here in the south east.

[cjohn] 14/12/2023 11:43

This was a really strong update.

Particularly pleased by the mention of further land sales and debt target of 55m by year end likely to be met.

Looks like margins aren't falling further.

And if house prices are stable in Scotland, then a PTBV of 0.5 is very cheap indeed.

[edmonda] 13/12/2023 08:45

"Increasing confidence, debt reduction on track"

New report with audio summary here:

Springfield’s half year trading update (six months to Nov ’23) confirms an in-line performance for H1 and reiterates full year expectations. After a challenging period for the sector, it is a reassuring update, pointing to subdued but stable conditions in Private housing, increasing activity within Affordable housing and clear progress with the Board’s debt reduction strategy.

Recent indicators suggest that the market may be stabilising (notably mortgage approvals ticking up in October as interest rates appear to have peaked) giving us confidence to introduce FY25 forecasts within this note.

Springfield’s shares have recovered somewhat over recent weeks, alongside sector peers, but still trade on just 9x P/E and 0.5x P/Book for FY25. With increasing visibility of profit recovery and cash generation, we increase our ED Fair Value to 130p (from 110p) based on a sector average Price/ Book multiple of 1.0x.

[swiss paul] 13/12/2023 08:25

Steady as she goes albeit with £93 mill of debt - ouch
Trading Update

Trading in line with management expectations - on track to meet debt reduction target



Springfield Properties plc (AIM: SPR), a leading housebuilder in Scotland focused on delivering private andaffordable housing, provides the following update on trading for the six months ended 30 November 2023.

· Trading in H1 2024 has been in line with management expectations

oDemand in private housing remained stable but subdued

oRecommenced signing new affordable-only housing contracts, with c. £24.0m of new contracts entered into

· Two profitable land sales agreed in H1 2024 for a total of £9.3m with funds to be received by the end of the financial year, and confident of signing other agreements in the near term

· Net bank debt at 30 November 2023 of c. £94.0m (not including the c. £8.8m outstanding proceeds from recent land sales) and on track to meet target of reducing net bank debt to c. £55.0m by 31 May 2024 (31 May 2023: £61.8m)

· Build cost inflation continues to reduce - expected to be c. 4% for H1 2024 - and there is greater availability of materials and labour

[value hound] 04/12/2023 09:16

Whatever the opposite of death by a thousand cuts is...

[marcus2418] 16/11/2023 21:22

I agree with you Cjohn. It's worth taking a smallish position as the upside could be quite interesting. The scottish supply/demand equation could look pretty good in 2/3 years but the company needs to rebalance their books first

[swiss paul] 06/11/2023 13:02

£24 million build - so what would be the profit on that ?

[makinbuks] 06/11/2023 12:14

£24m since may certainly helps and is not so little. This may be the way through this trough in the cycle. Certainly government initiatives appear likely to be focused in this area in the foreseeable future rather than the various Tory FTB schemes of the last decade. Something to watch

[value hound] 06/11/2023 08:45

What's Tesco's motto again? :-)

Seriously, though, it does help to 'pivot' things. Any news re the ongoing "discussions with other housebuilders and affordable housing providers about a number of our sites, which we hope to complete in the near term" will seriously help with share price recovery IMO - but it can't be easy in the current climate - particularly from a position of relative weakness.

[swiss paul] 02/11/2023 16:59

Skill your right in this. Am beginning to think oh no not another lifestyles co.

And they wonder why investors are leaving the UK market. Its not about risk to business its about Execs overpaying themselves