REG - Harworth Group PLC - AGM Statement

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RNS Number : 1318J  Harworth Group PLC  19 May 2025

HARWORTH GROUP PLC

('Harworth' or the 'Group' or the 'Company')

 

AGM Statement

Significant progress across major sites and submission of Northern Gateway
planning application

 

Harworth Group plc, a leading land and property regenerator of sustainable
developments, is publishing an operational update for 2025 to date, ahead of
the Company's Annual General Meeting (AGM) to be held today at 10am. The
results of the AGM will be announced at the conclusion of the meeting.

 

Lynda Shillaw, Chief Executive of Harworth, commented: "Following a record
year in 2024, with significant operational momentum across all parts of the
business, we continue progress towards the delivery of our targets of £1bn
EPRA NDV by the end of 2027, and growing our Investment Portfolio to £0.9bn
by the end of 2029. Despite a global backdrop that is more volatile and
challenging today than two months ago when we last updated the market, we
entered 2025 on a robust footing. We continue to bear fruit from the
investment made in scaling our business and we are taking advantage of the
particularly dry weather to advance enabling and infrastructure works,
supporting our priority of increasing the direct development of Industrial
& Logistics stock.

 

"2025 has seen the team make good progress across our major sites, including
submitting one of the largest planning applications in the UK for 6.5m sq ft
of employment space, as part of Phase 1 of our joint venture at Northern
Gateway in Greater Manchester. With 24.2 million sq ft of Industrial &
Logistics space and 13,610 Residential plots consented or in the planning
system, our focus is on structurally undersupplied sectors. Our management
actions of unlocking the underlying value of our extensive land bank and
growing our scale and financial flexibility - by increasing our development of
modern Grade A Industrial & Logistics assets - will help to insulate our
business amidst the ongoing geopolitical and economic uncertainty."

 

Markets beginning to see some respite

Despite the backdrop, the residential market, in our regions of Yorkshire and
Midlands, is seeing improved affordability with falling mortgage rates and
accelerated real wage growth, albeit this is tempered by historically low
consumer confidence and the impact of the UK's October Budget on businesses.
Both Yorkshire and-the-Humber and the Midlands benefitted from year-on-year
house price inflation to Q1-2025 of 5%+, according to Goodbody, although
nationally, Nationwide is quoting house price inflation of 3.9% for the same
period, down from 4.7% for 2024.

 

Falling interest rates should begin to improve the viability of sites
stimulating development across our regions, but again this will be tempered by
a number of factors: the impact of macroeconomic events on occupiers and
investors; the impact of the spending review on government's ability to
support development by enabling offsite infrastructure; and regulatory and
policy changes and associated impacts in additional costs and/or delays.

 

The recently announced trade deal between the UK and the US, in combination
with the indication that the 90 day pause in trade tariffs will allow for
further global negotiations, is expected to bring some respite to volatile
markets, and should be positive for our sector as businesses have more
stability. In our regions, while decision making cycles have lengthened, we
are seeing a steady level of enquiries from occupiers across our pipeline and
would expect these to pick up as geopolitical and economic tensions improve,
and requirements to onshore supply chains and manufacturing manifest
themselves.

 

Significant infrastructure and enabling works underway, underpinning our
developments

Our portfolio sits across three regions, two sectors and three portfolios with
the following abbreviations -

 

Three regions: Yorkshire & Central ('YAC'), Midlands ('MID') and the North
West ('NOW')

Two sectors: Industrial & Logistics ('I&L') and Residential ('R')

Three portfolios: Investment Portfolio ('IP'), Strategic Land ('SL') and Major
Developments ('MD')

 

·      At Wingates (Bolton)|NOW | I&L | MD / SL, we began 2025 with
1 m sq ft consented for logistics and manufacturing space and a further 1.9m
sq ft with a planning allocation. The realignment of the A6 is scheduled to
complete in June and Phase 1 infrastructure works are also underway, preparing
the site for development.

·      At Skelton Grange (Leeds) | YAC | I&L | MD, where we sold two
parcels of land to Microsoft, having completed the Phase 1 sale in December
2024, we continue to progress the infrastructure and site remediation works to
enable completion of Phase 2 of the transaction in 2026.

·      At Gascoigne Wood (Selby) |YAC | I&L | SL, where we have
planning consent for 1.5m sq ft of I&L, we have substantially completed
the demolition works prior to commencing the initial site clearance and
enabling works in H2.

·      At Chatterley Valley (Stoke) | NOW| I&L | MD, which is
development ready and can deliver up to 1.2m sq. ft of I&L space,
marketing of the site is underway, and subject to market conditions,
construction is anticipated to start later this
year.

·      At Gateway 36 (Barnsley) |YAC | I&L | MD, the next phase is
ready for delivery and being marketed - a further 250,000 sq ft is in for
detailed planning and we are in active negotiations with prospective
occupiers.

 

Extensive land bank underpins our ability to deliver our targets

Our extensive land bank underpins our ability to deliver our targets. At 30
April, our I&L pipeline increased to 34.1m sq ft (Dec 2024: 33.6m), and
our Residential plots stood at 30,763 (Dec 2024: 31,264).

 

Largest planning application submitted

At Northern Gateway (Greater Manchester) | NOW| I&L | SL, where the site
has been allocated primarily for advanced manufacturing and I&L, we
continue to assemble land into our joint venture, which has recently submitted
one of the largest planning applications in the UK for 6.5m sq ft of
employment space, as part of Phase 1 of the development.

 

Residential sales indicating healthy pricing

Following a record year for Residential plot sales in 2024, our sales
programme for 2025 is underway, having completed, exchanged or in advanced
legal negotiations on over 1,000 plots, including Planning Promotion
Agreements (PPAs), with initial sales achieving healthy pricing levels.
 Housebuilders remain cautiously and selectively active in the land market
and we are seeing a return to more stable reservation rates after March's
surge following the budget stamp duty changes coming into force.

 

Funding our development pipeline

We entered 2025 with a strong balance sheet and available liquidity, providing
the financial flexibility to execute on a significant level of enabling and
infrastructure work needed to support our ambitious development pipeline.
Recent months have seen us strategically deploy development expenditure to
advance site clearance, infrastructure and earthworks and secure power
reservations across multiple sites.

 

Using the flexible funding provided by our revolving credit facility (RCF), we
partially drew down on this facility, bringing our available liquidity to
£85.6m at the end of April (Dec 2024: £192.4m), with net debt at the end of
April of £154.4m (Dec 2024: £46.7m), representing a net loan to portfolio
value ('LTV') of 17.5% (Dec 2024: 5.4%), well within our own policy of up to
25% during the year. The majority of our sales are typically weighted towards
H2, allowing us to pay down debt and increase our firepower towards the end of
the year.

 

Sustainability

Alongside our 2024 Annual Report and Accounts, in April 2025, we published our
2024 Net Zero Carbon (NZC) Pathway Progress Report setting out our journey
towards our targets to achieve NZC operationally by 2030 and NZC for all our
emissions by 2040. The report describes how our evolving approach is embedded
in our sustainable developments alongside measuring our progress towards our
goals.

 

For further information

 

 Harworth Group plc
 Lynda Shillaw (Chief Executive)                     T: +44 (0)114 349 3131

 Kitty Patmore (Chief Financial Officer)             E: investors@harworthgroup.com (mailto:investors@harworthgroup.com)

Dougie Maudsley (Interim Chief Financial Officer)

 FTI Consulting
 Dido Laurimore                                      T: +44 (0)20 3727 1000

 Richard Gotla                                       E: Harworth@fticonsulting.com (mailto:Harworth@fticonsulting.com)

 Eve Kirmatzis

 

Annual General Meeting

 

The AGM will be held at 10am today at The Brearley Room, AMP Technology
Centre, Advanced Manufacturing Park, Brunel Way, Catcliffe, Rotherham, S60
SWG. Shareholders are advised to check our website at
https://harworthgroup.com/investors/annual-general-meeting
(https://harworthgroup.com/investors/annual-general-meeting) for the most up
to date information.

 

 

About Harworth

 

Harworth Group plc (LSE: HWG), is a leading land and property regenerator of
sustainable developments. We own, develop, and manage a portfolio of over
15,000 acres of Strategic Land over 100 sites located throughout the North of
England and Midlands. We specialise in delivering long-term value for all
stakeholders by regenerating large, complex sites, particularly former
industrial sites, into new Industrial & Logistics developments and
serviced Residential land to create sustainable places, support new homes,
jobs and communities where people want to live and work. Visit
www.harworthgroup.com for further information. LEI: 213800R8JSSGK2KPFG21

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