Springfield Properties Share Discussion Threads

[aldriglikvid] 04/9/2023 09:44

Fully agree with your take! Also interesting to note that Goldman Sachs this morning said that ECB probably made their final rate increase. Irrespective if it's one, or no more, in the pipeline; we're near or at the absolute top of rate increases for this cycle. Only one way to go from here.

[wskill] 04/9/2023 09:18

Managed to get a few more this morning to add to Fridays buy not too easy to buy SPR and its not huge amounts I was after .
Yes I did also see it was interest free the £35.8m read a bit more at the weekend and maybe its going to be a little weaker the housing market over the next few years,so even with a weak market SPR looks well placed so am adding but WTFDIK I have been wrong before.

[wskill] 01/9/2023 10:42

Yes I saw that on the last transaction the £35.8m is payable over 5 years when plots are sold min £7.7m per year can also be deffer ed for 12 months, looks as is the final £6.5m to tulloch will have been paid recently .

[aldriglikvid] 01/9/2023 08:53

Lot's of confusion here: a sizeable part of that "debt" is close to 0 interest and payment to the seller to settle recent m&a's. It's conditioned by sold houses and are thus highly favourable for Springfield.

On top of that, the interest coverage of this behemoth is unreal. Do you guys even look at the numbers? They are producing 17-20m ebit this year, and next year. Annually.

[ssahoy18] 01/9/2023 08:42

arent you worried about the bank? comes due in a bit over a year, theyll need to generate lots of cash to stave the jackals off, no way theyre getting it renewed on the same terms if the enviornemnt is still like this

[wskill] 01/9/2023 08:25

Will check over the weekend how many plots the 2 latest brought to the table,interesting though if borrowings are less than plot values it could be a decent investment even in a falling house price environment.

[aldriglikvid] 01/9/2023 06:53

Immaterial amount of new plots, compared to the sizeable old landbank - valued close to zero at the balance sheet. This is one of the largest bargains out there. And yes, 2023 will be weak - but who doesn't think that? That's consensus.

[wskill] 31/8/2023 14:22

Landbank for the 2 acquisitions would surely be valued about present day sale values although not sure how many plots they had?

[aldriglikvid] 31/8/2023 13:26

Landbank sits at ca. 8-9k/plot on the balance sheet. If you look at public real estate portals, you can't buy plots in Scotland below 50k. When Springfield sold plots themselves, throughout this year and last year, it was sold at ca. 80k a piece.

[value viper] 28/8/2023 21:55

What are their tangible assets / land bank worth do we think ? Suspect this is a very big discount to that

[wjccghcc] 28/8/2023 09:51

Yes but the short term risk here is high given the amount of debt. Most of the other builders repaired their balance sheets in the Covid boom and have or are close to a net cash position. Springfield made an acquisition at the top of the cycle have net debt of 68mm which rises to 110mm if you include deferred cash consideration vs a mkt cap of 66mm. Not the best preparation for a 20% drop in house prices in Scotland.

[chris szabo] 27/8/2023 17:35

Please help me here: If I compare our local (German) homebuilders to Springfield & the other UK players: with c13 years of land bank accounted for at cost, Springfield seems very attractive - even accouting for the problems at hand. Isn't that a formidable moat in a long-term attractive market?

[warranty] 23/8/2023 18:51

Could get even worse yet, better keep the tin hats on.

[value viper] 23/8/2023 18:11

Seller still in town

[dros1] 22/8/2023 22:55

Scotland to suffer worst house price slump of all UK nations

[value viper] 22/8/2023 19:31

Big after market dump - seller done - who knows

[dros1] 16/8/2023 16:26

looks like its all time low , is it really so bad ?

[aldriglikvid] 15/8/2023 18:39

This is just crazy cheap.

Warren Buffet bought 3 housebuilders as new positions in the quarter.

[tole] 10/8/2023 10:34

Large volume being cleared last few days

[scotches] 19/7/2023 19:53

Housebuilder Springfield has provided further evidence of how challenging trading conditions have become in the sector although it is confident the market will recover and has noted the outlook in Scotland is brighter than in other parts of the UK.

Springfield said that it expected to post record revenues of around £330 million for the year to May 31 helped by acquisitions completed in recent years. These allowed the firm to capitalise on the boom that was encouraged by a long period of very low interest rates and official support measures.

However, in an update on trading in the year to May 31, Springfield underlined that housebuilders are operating in much tougher conditions than at the start of the period. It said the 28 per cent growth in revenues was achieved despite turmoil in the market.

Chief executive Innes Smith said: "We remain cautious about the near-term outlook, particularly given the softening in demand following the increase in rates by the Bank of England to 5%.”

Mr Smith’s remarks highlight the impact on demand of the moves made by the Bank of England to push up borrowing costs in its bid to tackle surging inflation.

Builders have also seen their profit margins getting squeezed amid the cost pressures that the bank aims to address.

Springfield noted that it has taken a cautious approach to entering into new long-term affordable housing contracts given significant build cost inflation.

Other housebuilders have sounded a sober note recently. Barratt Developments said last week that its net reservation rate fell 32% annually in the year to June 30.

Springfield said it is taking a prudent approach. The company has cut costs and trimmed its land bank.

However, the company underlined its confidence that market conditions will improve in time.

The sector was boosted by news that the headline inflation rate fell to 7.9% in the year to June, from 8.7% in the year to May. This will encourage hopes the Bank of England will not increase interest rates further.

Shares in Barratt Developments rose around six per cent in morning trading.

Springfield sees advantages to being focused on Scotland rather than areas in which prices reached much higher levels during the boom, such as South-East England.

Mr Smith said: “The fundamentals of the housing sector in Scotland remain strong. There is an undersupply of housing, which is being exacerbated by the current conditions, and there is greater affordability in Scotland compared with the UK as a whole.”

Springfield also highlighted supportive aspects of the Scottish legal system, noting: “The Group's private housing is supported by the Scottish missive system, which ensures that customers are contracted into the purchase much earlier in the build programme.”

[swiss paul] 19/7/2023 08:28

Am in Watkin Jones (WJG) and the story is totally diferent. Well done Innes

[18bt] 19/7/2023 07:51

PER of 6x and yield of over 5%. And it looks like interest rates won't need to go as high as markets expected. Thinly traded but tempted to top up at these levels. Will see what the day brings.

[scotches] 01/3/2023 10:45

SPRINGFIELD Properties has secured the green light to build 1,000 homes in Midlothian.

The Elgin-based housebuilder has won outline planning permission for the proposed Lingerwood neighbourhood, and said it will now progress detailed proposals for the first 200 homes. It said the project will promote low and zero-carbon technologies and offer a range of homes, “catering for first-time buyers, young professionals, growing families and those setting into retirement”.

Springfield noted that the masterplan for Lingerwood will “embrace the 20-minute neighbourhood model which promotes local living”, adding that residents will be able to easily access facilities such as shops and play parks.

Martin Egan, chief operating officer at Springfield, said: “This planning consent marks a major milestone for a significant development that will bring forward excellent quality, energy efficient homes for people in Midlothian.

“However, more than this, Lingerwood will see the creation of a thriving village that can sustain the needs of local people for years to come. It will be a best-in-class example of place-making and we are confident that it will complement nearby established residential areas that already have distinct identities.

“We have spent a great deal of time consulting with Midlothian Council and local stakeholders and their feedback has been invaluable so far. We are keen to build on these relationships as we refine our plans and look ahead to the first phase of development.”

Last week Springfield said it had paused new activity in the affordable housing market, sparking an unspecified number of redundancies at the company.

The company declared the impact of cost inflation on fixed-price contracts in affordable housing had offset the growth it had seen in the private market as it reported profits had fallen by 5% to £5.9 million in six months to November 30.

[makinbuks] 22/2/2023 10:41

Alas I suspect the recovery is going to take longer than that