Springfield Properties Share Discussion Threads

[swiss paul] 15/10/2024 18:40

and there was me thinking - aye aye - someone has finally put therio hand in their pocket:
Springfield Properties plc (AIM: SPR), a leading housebuilder in Scotland focused on delivering private and affordable housing, announces that Iain Logan, Chief Financial Officer, has sold and repurchased into his self-invested personal pension ("SIPP") ordinary shares of 0.125 pence each in the Company ("Ordinary Shares").

Following these transactions, Iain Logan continues to have an interest in 30,000 Ordinary Shares, representing 0.03% of the Company's issued share capital.

But I suppose when you sitting on a shiot load of options at a low price - well why would you?

[alan@bj] 18/9/2024 09:09

BUY recommendation from Simon Thompson in the Investors' Chronicle today.

[edmonda] 17/9/2024 06:31

"Attractive growth outlook and 30% discount to peers" - new research report

Springfield is emerging strongly from a challenging year for the housebuilding sector, with debt substantially reduced, private reservations and affordable order book improving and an increasingly confident medium-term outlook.

FY24 results are in line with expectations and ahead of the original targets for the year. The dividend has been reinstated (1.0p final) earlier than forecast, in a sign of confidence. Management’s principal objective at the beginning of the year was to reduce bank debt to <£60m and this was comfortably achieved (£39.9m reported).

The partnership with Barratt at Durieshill is a reminder of the long-term value in the landbank, which also underpins genuine excitement in the prospects for the North of Scotland, a region that will benefit from a sustained and significant increase in investment over the coming years.

Whilst the shares have performed well over the past year, given the confident tone of today’s outlook statement, the Group’s low valuation relative to peers and the exciting opportunity emerging in North Scotland (not yet reflected in forecasts), we reiterate our Fair Value / share estimate of 140p.

Link to report:

[cjohn] 16/7/2024 09:59

Strong update, yet nothing that wasn't expected. These still seem significantly under-valued to me.

[scotches] 12/7/2024 21:15

Springfield has bolstered its management structure as the group navigates its way through challenging conditions in the housebuilding industry.

Chief executive Innes Smith said it was an "exciting time" as the group announced the promotion of Andrew Curran to managing director across Springfield Properties, Dawn Homes, Walker Group and Mactaggart & Mickel. At the same time, Kieran Graham becomes managing director of Tulloch Homes, which was acquired by the group at the end of 2021.

The appointments are designed to support acceleration of the group's growth strategy as builders across the sector have reported falling numbers of new home completions. Demand has been hampered by high mortgage costs, while on the operational side the industry says it is being held back by long delays in gaining planning permissions.

In a trading update earlier this week Springfield Group said total completions for the 12 months to the end of May will come in at approximately 870, down from 1,301 the previous year. Revenue is expected to be in the region of £266 million versus £332.1m previously.

Full-year profits, however, are expected to be slightly ahead of expectations thanks to £28m of land sales during the period. The group's debt will also fall by ore than previous forecast to circa £40m against a previous target of £55m.

Mr Curran has been promoted from regional operations director after a decade at Springfield and a further 11 years' experience with UK-wide builders including McCarthy Stone and Persimmon. Mr Graham was previously commercial director at Tulloch Homes, having previously worked for Stewart Milne Group in Aberdeen and Robertson Homes in Inverness.

Mr Smith has said the group is "cautiously optimistic" about the year ahead despite wider difficulties across the sector. He added that the new managing directors bring with them "invaluable" expertise to drive growth and innovation across the operation.

"It’s an exciting time across the Springfield Group with many new developments in the pipeline such as the recently-approved Conon Bridge development, delivered in partnership with the Highland Council, to support the Cromarty Firth Green Freeport," he said. "There’s also the long-awaited Durieshill development which we’ve collaborated with Barratt on to accelerate its delivery."

[swiss paul] 11/7/2024 09:57

I think they are taking a conservative view based on the interest rate.

Thanks for the supplemnetary info Edmond

[edmonda] 11/7/2024 06:29

"Strong delivery against cash generation targets"

Springfield’s year-end trading update confirms a positive conclusion to FY24 with profit and cash generation both ahead of forecast despite the challenging market backdrop. The key focus for the year was debt reduction and Springfield has once again proven its ability to reduce debt rapidly in response to changing market conditions. Bank debt reduced by over £20m during the year to c.£40m, well below management’s original £55m target. Current trading is steady, and Springfield is well positioned to capitalise on any improvement in market conditions.

Full year revenue is expected to be c.£266m, a 20% reduction year on year, reflecting challenging market conditions as well as Springfield’s decision to pause new affordable-only contracts during FY23. Revenue is therefore c.7% lower than forecast, but the impact has been more than fully offset by profitable land sales completed during the period.

We make no notable changes to our FY25 forecasts, which were already conservatively positioned and assume only modest revenue growth year-on-year.

We note that Springfield continues to trade at a marked discount to sector peers, notably a c.33% discount on a P/Book basis. We reiterate our Fair Value / share estimate of 140p, which equates to FY’25 P/E rating of 17.5x and P/Book of 1.0x.

Link to research:

[18bt] 11/7/2024 06:23

Quite an encouraging update - looks well positioned to ride the increasing interest in house builders with new Govt targets.

[cjohn] 03/6/2024 08:24

This is a very good deal and emphasizes the asset value of the land bsnk.

It materially improves their financial position.

[edmonda] 03/6/2024 06:29

"Barratt collaboration to accelerate Durieshill Village" - new research report here:

Springfield has entered into a strategic collaboration with Barratt for the development of the group’s Durieshill site. Springfield and Barratt will work together to develop this new, sustainable 3,000 home village within commuting distance of Edinburgh and Glasgow. Barratt has made a cash payment of £10m to Springfield and will, in consideration for half the land at Durieshill, provide and fund the infrastructure development for the entire site over the next five years.

The cash payment of £10m reduces Springfield’s bank debt to £41m as of 31st May, well below the stated target of £55m. More significantly, Barratt infrastructure funding will materially accelerate the development of the site, whilst also eliminating Springfield’s requirement to tie up capital for the next five years, This minimises development risk to Springfield and optimises the group’s return on capital.

In addition, Zoopla’s House Price Index for April was published last week. On their measurement, house price inflation was -0.1% for the UK, but with regional variations. They highlight 1.4% price growth in Scotland in contrast with negative inflation in London and the South of England.

Given today’s positive news, we increase our ED Fair Value / share to 140p (from 130p). This is based on sector average ratings (FY’24 P/E of 17.5x and P/Book of 1.0x) and still looks undemanding to us.

[18bt] 03/6/2024 06:25

Significant de-risking deal. Yes they have given up half the site, but the remainder will now get built with infrastructure going in and an additional £10m in the bank. Leverage is now down to less than 3x prospective EBITDA - c2.4x and they should be able to trade the debt further down from operating cash flows.

[swiss paul] 30/5/2024 14:46

Keeping the lights on?
Springfield signs £6.3m affordable housing contract



Springfield Properties plc (AIM: SPR), a leading housebuilder in Scotland focused on delivering private and affordable housing, announces that it has signed a new contract, worth £6.3m, with the Wheatley Group for the delivery of affordable housing.



Construction will commence immediately and is expected to complete by October 2025, with the majority of the revenue to be recognised in the Group's next financial year.



Innes Smith, CEO of Springfield Properties, said:"This new contract marks another great step for us in affordable housing, building on the excellent momentum with multiple recent contract wins and is a good way to end our current financial year in this area of the business. We are excited to once again be working with the Wheatley Group, a long-term partner of Springfield, to deliver these vitally important affordable homes. With our strong, established relationships with affordable housing providers across Scotland and a large high-quality land bank, we look forward to updating the market on further progress in this area in due course."

[swiss paul] 01/5/2024 07:06

Springfield signs £10m affordable housing contract



Springfield Properties plc (AIM: SPR), a leading housebuilder in Scotland focused on delivering private and affordable housing, is pleased to announce that it has signed a new contract, worth £10.1m, with Moray Council for the delivery of affordable housing.



The Group will receive funds from the sale of the land to Moray Council in the current financial year and the design and build phase, which accounts for the vast majority of the contract value, is due to be delivered over the next 18 months.



The development is being funded by Moray Council and The Scottish Government. It is part of the Moray Growth Deal, which is designed to boost economic growth across the region, including through a project to deliver hundreds of affordable homes, and brings together Scottish and UK governments, Moray Council, public and third sector organisations and private businesses.



Innes Smith, CEO of Springfield Properties, said: "We are pleased to have been awarded this latest affordable housing contract from Moray Council, which is a long-standing partner of Springfield. As part of the Moray Growth Deal, it reflects the importance of housing delivery to driving economic growth - and the recognition of this importance by the Council and Scottish Government. With our strong land-holding across the region and established relationships, we are well-placed to be awarded further contracts under this project to provide much-needed homes

[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&rdquo; 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.