Share Name Share Symbol Market Type Share ISIN Share Description
St.modwen Properties Plc LSE:SMP London Ordinary Share GB0007291015 ORD 10P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  2.50 0.79% 318.50 314.00 316.50 321.00 310.00 317.00 815,353 16:35:25
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Real Estate Investment & Services 429.9 58.9 22.8 14.0 708

St.modwen Properties Share Discussion Threads

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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
Also noting that all 3 brokers reiterate buy rating, and 53.5% hike in interim dividend should be supportive too.
St Modwen Properties Interim Profit Drops Despite Revenue Growth: 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 ..
27% of RETAIL property as I read it. However good result in a difficult area.
Decent sale of 27% of porty should boost future returns.
..glad ONE of my holdings is having a good day today.
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.
Does the country need more bonded warehousing near ports post Brexit ?
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.
useful reduction in debt interest, should help profits.
I agree. Automated stops can, on some occasions, make a loss for you. In this case it is beyond my comprehension why the first three minutes traded so mysteriously and then took 15 minutes to recover fully.
Today's an example as to why I refuse to have automated stops in the market any more. Wtf was that at the open?!
May be a mistake but sold out this week c.380p. GL to those who remain.
its the oxman
anley I don't dispute your optimism but I am not sure how many millions might be available for future developments. They will have to pay tax on their gain at Nine Elms as they are not a REIT. Some of the proceeds have been set aside to develop the area of the old market. I shall be more hopeful when Swansea University gets sold.
We are now into July and that deal was completed so they can move on. In the meantime one is buying a share with a £1 discount to NAV which includes millions of cash in the bank. It is not often one gets these chances especially with more property to sell.
From FT In Nine Elms, analysts have long questioned the sheer number of planned luxury apartments. “It’s looking to be quite a major oversupply,” says Roarie Scarisbrick, agent at Property Vision. Another developer, St Modwen, wrote down the value of its land holdings in the area by 17 per cent last year. Battersea Power Station Development Corporation, which is developing the historic building itself, has applied to delay the construction of 103 affordable homes and review other affordable housing commitments. Citing rising costs and economic uncertainty, it said its expected internal rate of return had dropped to 8.2 per cent from a projected 20 per cent. It is not the only group seeking to modify its affordable housing obligations as Brexit casts a cloud over the economy. Edoardo Mapelli Mozzi, chief executive of the London developer Banda Property, says: “The private sector alone cannot deal with affordable housing. This way, it only gets built if the top end of the market is working.” This contrasts with Greystar@s response in Property Week “We’re aware of all the noise, we read everything everyone else reads, but we’re just a very long-term business and the long-term potential for this area is amazing,” Allnutt said. “If you fast-forward six, seven, eight years it should be an incredible new place in London on the river.” Royal Mail still have land available to accomodate another 900 apartments and with Greystar servicing the plots will be in a more oven ready position for market The site is of course close by SMP Can see another £30-£50m trimmed from book value which will only be slightly mitigated by the potential windfall on Swansea Shame that all the good work in the regions is overshadowed by this
Perhaps they are asking too much.
Royal Mail has agreed to sell two of the seven plots on the site of its former south London mail centre at Nine Elms site to US-based developer Greystar for £101m cash, which has appointed AIM-listed Telford Homes to deliver 894 build-to-rent homes. If Royal Mail can do it, why can't St Modwen ?
Yes. They have created a new stand alone house building arm that broadens the business base. The only danger to that is a fallout in the market. The sale of the Swansea Campus is the right move. It will free up capital for new developments. Nine Elms is still a sticking point. For whatever reason, nobody is jumping through hoops to buy it. Management is doing a good job.
Pretty confident statement. - St. Modwen said that since the start of the financial year its diverse portfolio and wider business has continued to perform in line with directors' expectations. It said it had demonstrated resilience in the face of broader market uncertainties. CEO Mark Allan said over the last six months St. Modwen had undertaken a detailed review of the current portfolio and the existing opportunities within its extensive asset base. "The outcome of this review has been positive, highlighting the strength and depth of opportunity within the business and portfolio to create value through our regeneration, commercial and residential expertise," he said. "Having experienced a positive start to the year that reflects management expectations, we will now continue to refine the strategy further and concentrate on those areas of our deep and diverse portfolio that present genuine opportunities for value generation and further business growth which will ultimately lead to enhanced shareholder returns."
St Modwen Properties has booked a much lower FY pretax profit of £66m, from a profit of £235.2m a year earlier. The results included broadly flat revenue at £287.7m, from £287.5m, but lower contributions for gains on disposals and revaluation gains. Administrative expenses were higher, and it booked a loss on joint ventures and associates from a year-earlier profit. However, its EPRA net asset value per share rose to 460.5p, from 446.4p, and total dividend was hiked to 6p a share, from 5.75p. "Active commercial property development and asset management, coupled with a strongly performing and growing residential arm, contributed to another good year for St. Modwen," said CEO Mark Allan. "This is despite the turbulent market backdrop during 2016," he added. Allen said the company had begun a review of what he believed was a "fundamentally strong" business and portfolio to determine its strategy moving forward. "We unquestionably have an opportunity to build on our existing strengths while ensuring that our activities are focused in the optimum way and I am excited about the prospects ahead." OUTLOOK St. Modwen said it was a long-term business operating in cyclical markets and therefore must plan and manage its business accordingly. "The past 12 months have been unsettled in this respect and the outlook for 2017 and 2018 looks to be similarly uncertain, as a range of macro-economic factors play out both globally and more locally to the UK," it said. "With this outlook, it is important that we continue to manage our balance sheet prudently while also seeking out appropriate new value creation opportunities and converting existing ones. "This will require an innovative and agile approach but our track record suggests we remain well placed to succeed."
Results read well. Further progress expected and sector sentiment will turn at some point, just not sure when.
its the oxman
A superb set of results from a very well managed Company.Share price NAV of circa 430p must make this a screaming BUY.
This happens on the actual account statement for both sites, rather than when searching for SMP for a quote.
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