Regeneration specialist “in a position of strength”
St Modwen Properties, which specialises in regeneration, today reported a return to full-year pre-tax profit of £37.5m for the year to 30 November 2010 (2009: loss £119.4m) and a 9% increase in net assets per share to 218p. The company issued a confident statement, saying it was well positioned to deliver profit and further growth in net asset value this year, despite the ongoing uncertain market conditions.
“During the course of this year, many commentators have focused their attention on the prospects for ‘prime’ assets. It is therefore pleasing that we have been able demonstrably to deliver against our strategy and business model and record healthy year-on-year growth in profits, property valuations and net asset values,” commented chairman Anthony Glossop, who is retiring at the forthcoming AGM.
Chief executive Bill Oliver noted that a lack of available finance and the drive to cut risk had continued to restrict many new developments. “By contrast, in this new competitive landscape, we are operating in our chosen regional and secondary markets from a position of strength. We are identifying an increasing stream of opportunities, both for acquisitions and for developments which offer clear potential to create and enhance value for our shareholders,” he added. Mr. Oliver also noted that the group’s occupier markets had remained relatively resilient. St Modwen had reduced void levels to 12% from 17% a year earlier and increased its recurring gross rent roll to £45.7m from £43.0m, he pointed out, and was also seeing increased enquiries about new development space.
Mr. Oliver said the group had seen some improvement in market conditions during the past 12 months, and added that although its development activity levels were still below historical rates, they compared favourably with the market. The value of the group’s commercial land had stabilised while its residential land had recovered some of the value previously lost.
The group also announced today that it had submitted a detailed planning application for the £70m Longbridge Town Centre plan, which includes a 85,000 sq ft food store and an additional 80,000 sq ft of retail space and restaurants, a hotel, 40 apartments and a new park. St Modwen has also spent £400,000 on adding two sites from UK Coal to its long-term landbank. The sites comprise 68 acres, 60 of which are at Pelshall in Walsall with the remainder at Castle Gresley near Swadlincote in Derbyshire.
