St.modwen Properties Share Discussion Threads

[cordwainer] 21/10/2019 12:48

Even the brokers are only rating it as Hold. That's a juicy +25% from August up to today.

[deadly] 18/10/2019 08:57

If it was fully priced, then even more so now. For some reason close to all-time high.

[cordwainer] 28/6/2019 00:03

Probably fully priced here now and currently better value over at Helical at the moment when comparing NTAV per share. I suspect next week's half-year results need to beat expectations to support the current 420-440p range.

[cordwainer] 25/3/2019 14:43

Sharing a non-exec with Domino's, E.g. "..ah yes, but might be best to have your new Domino's Pizzo branch here rather than there because its not public knowledge yet but SMP are likely to sell and build out this nearby site for a 300-operative Screwfix shed and its commuters and customers will ..."

[cordwainer] 20/2/2019 11:38

I take another look at this if it falls to 370p in the short term. epra p/e and %yield could be better going into general economic uncertainty, even taking into account stronger balance sheet, imho.

[redartbmud] 07/2/2019 22:14

Can't argue with your opinion, it seems to follow my train of thought very closely.

[cordwainer] 07/2/2019 22:11

Having made about 10% on the stock after fees in 10 months, i'm satisfied.
Decision to sell not really very stock-specific.
Despite SMP's excellent no-deal brexit contingency planning, being in the FT250 market sentiment towards the UK might override that if no deal happens. I confess no-deal brexit fear has encouraged me to increase my cash position, even though SMP probably deserves a good quality hold rating.

[redartbmud] 06/2/2019 16:32

cord

What do you do to wainer a cord?

If they are so well managed, what are your reasons for crystallising profits?

[cordwainer] 06/2/2019 16:21

.. however I crystallised profits on SMP this morning.

[cordwainer] 05/2/2019 23:04

Could not be better managed, imho.

[topvest] 05/2/2019 18:01

Yes, happy to hold. Gearing position is smart at this point in the cycle.

[deadly] 05/2/2019 14:29

Decent results today. NAV up 5%, discount 15%.

[cordwainer] 30/11/2018 16:41

thanks, talk to yourself cordwainer
today's debt reduction relatively small why pay out unnecessary interest after selling assets ?

[cordwainer] 05/7/2018 05:16

from The Times TEMPUS:
Selling strategy is paying dividends for St Modwen

If you are looking to buy a few shops, or perhaps a small shopping centre, or even, say, a town centre in Edmonton Green in north London, look no further than St Modwen Properties.

The FTSE 250 regeneration specialist is on a selling spree and, frankly, it could not come soon enough. Until the start of last year, the company had languished as a property business with an erratic and sprawling portfolio that did not make a lot of sense. It had specialised in buying land that no one else wanted to develop, such as old oil refineries or steelworks, and turning them into huge sites of offices, shops and retail.

It also held a 15-year-long landbank but no real housebuilding business to speak of, small retail assets that were not generating much income, and town centres that were returning little more than £5 million in rent, such as Edmonton — yours for £70 million, if you are interested.


Mark Allan, the former chief executive of Unite, the student accommodation provider, came in and changed all that. He decided that St Modwen would continue to take on regeneration sites but the focus would be housebuilding and industrial and logistics centres. Almost everything else could go. It was a bold move and has pleased investors it seems. The share price since Mr Allan arrived in December 2016 is up to 404p from 303p.

The group’s interim results show its strategy is going well. The company has sold £350 million of assets, including £95 million of retail, taking disposals since the strategy was announced last year to £635 million, representing 35 per cent of St Modwen’s portfolio. Yes, some of the retail assets are selling 4 per cent below November 2017’s book value but in this climate that should not be considered a bad run.

The returns from selling properties are also showing big gains for the company. Take the £95 million of retail and £139 million of student accommodation in Swansea the group sold in the first half of the year. This was delivering a net rental income of about £10 million a year.

The group has invested half the proceeds from these sales — about £110 million — in its logistics and industrial pipeline and is set for an income of £11 million a year. Scale that up to £500 million of capital being recycled and that translates into a big move on earnings and, by extension, the dividend over the next two to three years.

In the past, a lot of cash generated by St Modwen was development profits, as the company sold all that it developed. Now it will hold on to assets that generate an income and link the dividend to the recurring cashflow from this activity and housebuilding profits. This means, as income increases, dividends should rise more strongly. St Modwen reported a 53.5 per cent increase in the dividend to 3.1p per share, up from 2.02p a year earlier.

The cash from these disposals is enabling the management to pursue an ambitious development strategy of boosting its residential and logistics divisions by 25 per cent a year, while keeping debt at a low level, at 24.2 per cent loan to value in the first half.

The shares dipped 4 per cent to 404p after the company revealed profits were down 18 per cent to £25.9 million and earnings per share fell 22 per cent to 9.4p, although net asset value per share rose by 1 per cent to 455.4p. The company expects profits to be up on the year with the interim fall due to the winding down of a joint venture with Persimmon.

The total return for the half year was 2 per cent but is expected to be 6 per cent for the full year. St Modwen wants that to rise to between 10 per cent and 11 per cent within three years and that means a big boost in dividends. With shares at a 16 per cent discount to November 2019’s NAV, this is worth a buy.

ADVICE Buy
WHY Sensible disposal strategy is performing well and will boost dividends over a three-year horizon

[cordwainer] 03/7/2018 19:20

Also noting that all 3 brokers reiterate buy rating, and 53.5% hike in interim dividend should be supportive too.

[cordwainer] 03/7/2018 15:46

St Modwen Properties Interim Profit Drops Despite Revenue Growth:

www.morningstar.co.uk/uk/news/AN_1530602456829099400/st-modwen-properties-interim-profit-drops-despite-revenue-growth.aspx

Well I guess its ultimately the NAV per share that matters most, and that got nudged in the right direction. Haven't actually read much of the interim report yet though. Recent trends seem to bear out the soundness of the strategy.

Apparently initially well received update followed by profit-taking.

Anyway, it's only the Basic EPS which dropped, for a real estate company it can be argued that the increased EPRA EPS is more relevant ..

www.stmodwen.co.uk/wp-content/uploads/2018/07/2018-h1-results-announcement.pdf

[linhur] 13/5/2018 07:12

27% of RETAIL property as I read it. However good result in a difficult area.

[deadly] 09/5/2018 08:32

Decent sale of 27% of porty should boost future returns.

[cordwainer] 19/3/2018 16:08

..glad ONE of my holdings is having a good day today.

[cordwainer] 08/3/2018 10:42

approx NAV p/s 450p, NNNAV p/s 458p ..

is the market expecting substantial asset writedowns here (e.g. -20%) ?
or maybe not liking the mildly high gearing ?

or simply just not liking UK real estate ?

don't see why this should be lower rated than New River Reit.

[spacecake] 04/1/2018 20:04

Does the country need more bonded warehousing near ports post Brexit ?

[linhur] 19/12/2017 23:44

The problem with debt renewal is the write off on the swaps when you get out. Also fees seem to be increasing as you have to get more banks involved because they only want a small share of the debt.

Overall bottom line will not improve much because of swaps write off. See this a lot with debt renewal.

[deadly] 19/12/2017 09:14

useful reduction in debt interest, should help profits.