Springfield Properties PLC Trading Update (0671X)

TIDMSPR

RNS Number : 0671X

Springfield Properties PLC

17 December 2019

17 December 2019

Springfield Properties plc

("Springfield" or the "Group")

Trading Update

Springfield Properties plc (AIM: SPR), a leading housebuilder in Scotland offering private and affordable housing, is pleased to provide the following update on trading for the six months ended 30 November 2019, ahead of announcing its interim results on 25 February 2020.

Key highlights:

-- On target to report H1 2019/20 revenue growth and gross margin improvement in line with management's expectations

   --      Bertha Park Secondary school now open to new pupils 
   --      Walker Group acquisition performing as anticipated 
   --      Collaboration agreement signed with Sigma for private rented sector ("PRS") projects 

As noted in the full year 2018/19 results announcement, Springfield entered the current financial year in a strong position, experiencing good growth across the business, supported by sustained market drivers. This momentum was maintained through the first half of 2019/20, with an increase in completions and revenue in both private and affordable housing. As a result, and with the contribution from Walker Group, which was acquired in H2 2018/19, the Group expects to report revenue growth and improvement in gross margin for the first half of 2019/20, in line with management's expectations.

Springfield's Village developments have progressed well, and their appeal is strengthening as they become increasingly established, adding further amenities for residents. This includes the opening of Bertha Park Secondary School, the first new secondary school to be established in Scotland for more than 15 years, and a sports centre at Linkwood, Elgin. At the Group's most advanced Village developments, Dykes of Gray and Bertha Park, management estimate that, in total, more than 600 people have moved into the new homes to date.

During the period, Springfield expanded its geographic presence with the strategic land acquisition of a private housing development in Inverness, strengthening the Group's reach in the Highlands. The Group also continued to make good progress in affordable housing, including under its local authority framework agreement for 10 affordable-only developments, with the completion of one development and beginning construction on two others, as well as a third affordable development (outside the framework agreement) also commencing during the period.

Walker Group and Dawn Homes continued to trade in line with management's expectations and the Group is pleased with the progress made to date in embedding these acquisitions. In addition, the Group achieved a key milestone, as announced on 25 September 2019, with the entry into a Collaboration Agreement with Sigma PRS Management Ltd to acquire and develop sites in Scotland for PRS. This represents Springfield's first partnership for PRS and the Board expects it to accelerate Springfield's delivery of homes and provide a further revenue stream, alongside its existing private and affordable housing activity.

Innes Smith, Chief Executive Officer of Springfield Properties, said: "We're pleased to have achieved another period of growth resulting from sustained progress across our business as we continue to deliver on our targets. Our acquisitions are performing well and we are excited about the new opportunities offered by our partnership with Sigma. The UK is entering a period promising greater market certainty, which will benefit our customers, our suppliers and our business. This, combined with a land bank providing work for at least 16 years and a skilled and dedicated workforce, gives us continued confidence in our future prospects and in achieving our goals."

The Group will provide further details at the time of its interim results announcement on 25 February 2020.

Enquiries

 
 Springfield Properties 
 Sandy Adam, Executive Chairman 
  Innes Smith, Chief Executive Officer    [phone] 
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 N+1 Singer 
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 Shaun Dobson, James Moat (Corporate 
  Finance) 
  Rachel Hayes (Corporate Broking)        [phone] 
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 Luther Pendragon 
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 Harry Chathli, Claire Norbury, Alexis 
  Gore, Joe Quinlan                       [phone] 
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December 17, 2019 02:00 ET (07:00 GMT)