REG - Harworth Group PLC - Full Year Results for year ended 31 Dec 2025
Today 07:00
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RNS Number : 8869W Harworth Group PLC 17 March 2026
HARWORTH GROUP PLC
('Harworth' or the 'Group' or the 'Company')
Full Year Results for the year ended 31 December 2025
Sustained Industrial & Logistics momentum & strategically positioned
to unlock high value opportunities
Harworth Group plc, a leading regeneration, strategic land and development
business, today announces its results for the year ended 31 December 2025. See
page 2 for summary of business and abbreviations(1).
Summary highlights(2) 2025 2024 % change 2025 2024 % change
Total accounting return (%) 1.7 9.1 -7.4pp Value gains (£m) 44.5 97.2 -54.2
EPRA NDV per share (p)(3) 224.4 222.3 +0.9 Total Property Return (%)(4) 8.4 12.0 -3.6pp
EPRA NDV (£m)(3) 727.3 719.5 +1.1 Total property sales (£m)(5) 115.0 215.8 -46.7
Net loan to portfolio value (%) 15.6 5.4 +10.2pp Residential plot sales(6) 1,837 2,385 -23.0
Portfolio value (PV) (£m) 937.2 858.8 +9.1 Inv. Portfolio value (£m)(7) 305.0 297.2 +2.6
I&L weighting of PV (%) 70 63 +7pp Inv. Portfolio Grade A (%)(8) 76 63 +13pp
Financial highlights(9) 2025 2024 % change 2025 2024 % change
Total dividend per share (p)(10) 1.775 1.614 +10.0 Operating profit (£m) 21.6 74.6 -71.0
Net debt (£m) 145.9 46.7 +212.0 Stat. portfolio value (£m)(11) 899.4 821.6 +9.5
Net assets per share (p) 215.6 213.7 +0.9 Net asset value (£m) 699.0 691.7 +1.1
pp = percentage point change
Lynda Shillaw, Chief Executive of Harworth, commented: "I am pleased with the
performance of our teams and our operational execution throughout 2025,
positioning the portfolio to realise future upside potential and delivering a
total property return of 8.4%, outperforming the MSCI UK Annual Property Index
of 5.6%. As we continue to execute our strategy and reposition the portfolio
towards I&L, our long-term through-the-cycle model, management actions and
disciplined approach to capital deployment remain essential to creating value
for shareholders, including our £1bn of EPRA NDV ambition and high-single,
low double-digit total accounting return target. Over the last five years to
2025, the sustained delivery of our strategy has delivered cumulative Total
Accounting Returns of 44.5%.
"Harworth is at the intersection of some of the UK's most powerful trends,
including data, advanced technologies, reindustrialisation and clean growth.
Our land bank provides both strategic levers and optionality to generate
attractive risk-adjusted returns, and the Harworth Platform underpinned by our
specialist skills and ability to deliver successful serviced land and
developments for world-leading businesses is central to stimulating and
supporting economic growth in our regions.
"Land at scale, suitably zoned and power-enabled, is key to accessing emerging
market opportunities such as data centres. For a subset of sites, we have been
actively pursuing upside opportunities with 0.8GW of power connections either
conditionally secured or in the pipeline with Network Operators. Together with
further applications currently advancing, these represent significant progress
towards both near and longer-term transactions that have the potential to
deliver enhanced value gains and superior returns.
"While we are monitoring the conflict in the Middle East and its potential
impact on the UK economy and our markets, we remain encouraged by a continued
pipeline of strong interest across our I&L land and property portfolio of
1.6m sq ft. We are in a strong position to capitalise on market trends and
unlock value to crystallise attractive medium-term opportunities, giving the
Board confidence in Harworth's potential to deliver exciting projects and
achieve attractive shareholder returns."
2025 PERFORMANCE
Strong I&L performance supporting future growth
· I&L land and property portfolio now at 70% of portfolio value
(2024: 63%) delivering return on capital deployed across I&L Major
Developments and Strategic Land of 22.9% and 8.7% on the I&L Investment
Portfolio.
· I&L Investment Portfolio valued at £305.0m, with EPRA
vacancy(12) reduced to 1.0% (2024: 5.6%) following strong lettings and
disposals.
· Completed £47.7m of IP headline sales and 1.4m sq ft of leasing,
including 379,000 sq ft of new leases, adding £3.7m of rent, like-for-like
rent up 10.4%.
· IP Grade A quality increased to 76% by value and 64% by area (2024:
63% by value, 45% by area).
Accelerated Residential sales drive capital recycling
· Completed 1,837 plots sales (including 725 plots under Planning PPAs,
generating £3.1m of fees) and delivered £52.0m of freehold headline sales at
a marginal discount to June book values.
· Residential sales since 2020 crystalised £343m of capital, reducing
consented plots by 67% to improve capital efficiency.
EPRA NDV driven by I&L value gains
· EPRA NDV per share of 224.4p (2024: 222.3p) delivering a total
accounting return ('TAR') of 1.7%.
· Net value gains of £44.5m, reflecting £73.6m in I&L value
gains, partially offset by £28.7m of value losses across Residential Major
Developments, reflecting prevailing residential market weakness.
DRIVERS OF FUTURE GROWTH
Data centre and power-enabled land platform gaining momentum
· Significant progress identifying data centre and power-enabled land
portfolio within our land bank.
· 0.8GW of power connections conditionally secured, or advancing
through Network Operators' pipelines.
· Near-term opportunities in active discussion.
I&L land & property portfolio positioned to realise value
· Enabling works completed or significantly progressed on land with
capacity to deliver 4.0m sq ft into I&L and emerging growth sectors,
positioning the portfolio to accelerate value realisation.
· Acquired remaining 50% interest from JV partner at Gateway 45
adjacent to Microsoft's proposed hyperscale data centre at Skelton Grange,
£53.2m of cash and associated value gains expected over the next year
· Strong interest in 1.6m sq ft of potential deals across a broad
range of I&L transactions.
· 22.2m sq ft of I&L land with consent or awaiting determination
of planning, driving pipeline for next generation of sites, including Northern
Gateway JV.
· I&L land bank capacity to deliver up to 35.0m sq ft, 75%
consented or in the planning system.(13)
Enhanced financial capacity to scale I&L
· Refinanced and enlarged RCF to £275m (from £240m) with accordion to
£325m, 25bps to 35bps improvement in margin ratchet.
· Year-end liquidity of £127.1m; LTV at 15.6%, below <20% year-end
target, supports value enhancing investments.
About Harworth
We aim to create long-term, through-the-cycle value by focusing on:
Two structurally undersupplied sectors: Two core products:
1. Industrial & Logistics ('I&L') growing to 85% weighting 1. Serviced remediated land for sale
2. Residential ('R')
2. Development land to hold and for sale
Three portfolios: Three regions:
1. I&L Investment Portfolio ('IP'), 1. Yorkshire & Central ('YAC'),
2. Strategic Land ('SL')
2. Midlands ('MID')
3. Major Developments ('MD')
3. North West ('NOW')
Our land bank stands at 35.0m sq ft of I&L of which 75% is consented or in
the planning system(13) (Dec 2024: 33.6m sq ft; 63%) and 29,386 Residential
plots of which 45% are consented or in the planning system (Dec 2024: 31,264;
46%).
Since 2021, we have achieved planning on 9.2m sq ft of I&L space with an
estimated Gross Development Value ('GDV') of £1.3bn, we have concluded on
cumulative sales of c. £700m, including 9,000 Residential plots and we have
bought or taken options over I&L land totalling 14.3m sq ft, with an
estimated GDV of £2.1bn.
Harworth Group plc (LSE: HWG), is a leading regeneration, strategic land and
development business focused on the I&L and Residential sectors. 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, into new I&L developments and serviced remediated land for
sale into the I&L and Residential land markets. Our long-term
through-the-cycle business model is 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
Notes:
1. All values are Harworth's share, unless noted otherwise
2. Represent our Alternative Performance Measures (APMs). A full description
of these is set out in Note 2 to the financial statements with a
reconciliation between statutory measures and APMs set out in the Appendix to
the financial statements
3. European Public Real Estate Association Net Disposal Value
4. Total Property Return (TPR) is the ungeared return of the portfolio as a
percentage of capital employed. TPR figures calculated by MSCI.
5. A reconciliation of Total property sales is set out in the Appendix
6. Residential plot sales for 2025 includes 1,112 freehold plot sales and 725
plot sales through Planning Promotion Agreements (PPAs)
7. The Investment Portfolio represents our primary income generating I&L
portfolio. It excludes Strategic Land, Major Developments, Natural
Resources, and Agricultural land
8. Measured by value. Grade A by area is 64%
9. The financial highlights represent our statutory measures
10. The Ex-dividend date, Record date and Payment date for the 2025 final
dividend can be found in the Shareholder Information section of this
announcement
11. Statutory portfolio value includes investment properties, development
properties, Assets Held for Sale (AHFS), occupied properties and investment in
joint-ventures, refer to Note 2 to the financial statements
12. European Public Real Estate Association vacancy rate
13. In the planning system includes draft allocations, allocations and
awaiting determination
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)
Juliana Weiss Dalton (Investor Relations)
FTI Consulting
Dido Laurimore T: +44 (0)20 3727 1000
Richard Gotla E: Harworth@fticonsulting.com (mailto:Harworth@fticonsulting.com)
Eve Kirmatzis
Results presentation
Harworth will host a presentation for analysts and investors at 10.30 am
today. A live webcast and playback of this can be accessed at the following
link: https://brrmedia.news/HWG_FY_25
(https://stream.brrmedia.co.uk/broadcast/699d7ba54f450d001255166f)
Engage Investor presentation
A presentation relating to these results will also be hosted via the Engage
Investor platform on 23 March 2026 at 3.30pm. Harworth welcomes all current
and interested shareholders and encourages investors to pre-submit questions.
Investors can also submit questions at any time during the live presentation.
Investors can sign up to Engage Investor at no cost and follow Harworth Group
plc from their personalised investor hub. Please register for the event here:
https://engageinvestor.news/HWG_IP26
(https://www.engageinvestor.com/event/69a073b1f94b53940c815a27)
Chair's statement
Introduction:
During 2025, we have executed against our strategy to deliver for our
shareholders and wider stakeholders in a challenging environment and further
position our business for long term success and value creation.
This has been a year of sustained operational progress following our strategic
pivot to accelerate our Industrial & Logistics ('I&L') land bank,
allocate capital to site investment for future delivery, and retain more prime
Grade A assets in our Investment Portfolio.
The UK macroeconomic backdrop has been challenging throughout 2025 with its
impact particularly apparent across the residential sector, where weakening
residential fundamentals have been exacerbated by supply side regulatory and
cost hurdles and lack of demand-side stimulus. Our future pipeline remains
focused on I&L where 2025 saw greater stability of market fundamentals.
Prudent investment in site assembly and enabling works has meant we are well
placed to deliver Grade A assets when momentum builds in the market.
With interest rates staying higher for longer than anticipated and with
occupier and investor caution regarding UK fiscal policy, a broad-based uplift
in demand has yet to come through. Most market commentators are reporting
further weak growth in Q4 2025, impacting demand and asset valuations,
particularly across the residential market. Overall, timeframes to conclude
deals remain elongated, and whilst there was a short respite post the autumn
UK Budget, we are mindful of the potential impact on this year of recent
geopolitical uncertainty and the resulting wider macroeconomic effects. This
has been, and remains, a challenging environment for our teams at Harworth, as
they have worked diligently to successfully complete sales and lettings
transactions.
Against this backdrop, the business has successfully evolved the quality of
the Investment Portfolio by transferring in new Grade A developments and
reducing vacancy through strong letting activity. Total Property Sales of
£115.0m completed, including 1,837 of Residential plot sales. These
transactions are testament to the capability of our people, their specialist
skillset and deep market network. The continued outperformance relative to the
market of the I&L land and property portfolio supports our decision to
allocate capital to the next generation of sites in anticipation of improved
market demand and thereby deliver value creating management actions.
Our people:
The long-term sustained growth of Harworth is best delivered by creating an
environment that cultivates a high-performance culture. Our high talent
retention and strong employee engagement and happiness scores have culminated
in the award of the Investor People Gold accreditation. This a relatively rare
achievement for a first-time assessment and reflects the growing effectiveness
of our people strategies and our drive for continuous improvement, supporting
our people to achieve their full potential for the benefit of all our
stakeholders.
The speed with which we can progress as a business directly depends on our
success in bringing together the necessary skills, experience and
relationships. It is therefore critical that we attract and retain the
leadership talent we need to achieve our strategic ambitions. This was the
driver behind the Remuneration Policy that was strongly supported by
shareholders at the May 2025 AGM to cover the 2025-2027 three-year period. We
consulted widely prior to putting this policy to the vote and have
subsequently further explained our rationale to those of our shareholders who
disagreed with our approach.
In 2025, Harworth's leadership successfully delivered an internal restructure
to better support the business's future growth. Operations moved from a
regional to national structure to improve delivery capabilities, support scale
and accelerate existing successes. As we continue to pursue our strategic
ambitions by growing the next generation of sites, the associated development
pipeline and our I&L Investment Portfolio, we recognise the need to ensure
that our people have the resources and capabilities to add maximum value
working alongside our Harworth partners.
The Harworth Way:
As a leading regeneration specialist and strategic land owner, our unique
oversight of the full development lifecycle - from land assembly and planning,
through to multi-phased infrastructure, building and placemaking - enables us
to align commercial outcomes with the creation of long-term benefit for our
communities, people and the planet. By supporting the delivery of new jobs and
homes we aim to ensure a positive lasting impact.
Sustainable outcomes, including our Net Zero Carbon ('NZC') ambitions, are
well embedded into our delivery operating model and form a fundamental element
of our overall growth strategy. The Harworth Way continues to serve as our
framework for integrating sustainability and social value from idea and design
concept to final occupation, guiding our decisions as to how to invest in,
develop, and manage our sites.
We continue to make good progress against our 2030 NZC target for our business
operations. Collaboration with our supply chain is central to our progress
towards achieving our 2040 NZC target for all emissions. Our upstream Scope 3
emissions reporting via our contractors and suppliers and downstream emissions
from tenants in our I&L Investment Portfolio are key to identifying our
largest elements of emissions and guiding us as to where to focus to meet our
targets. We have a strong track record of working in partnership with
suppliers, occupiers, and local and combined authorities and are well placed
to deliver whole life carbon and detailed energy assessments as part of our
approach to developments.
Since 2022, our developments have met specified embodied carbon and
operational energy targets, with rooftop solar included as standard. More
recently, our work on nature and Biodiversity Net Gain ('BNG') has matured,
delivering our first two habitat banks, to support the development of our
sites. This is a model that we will look to replicate across our portfolio
with more sites in the planning pipeline as we integrate BNG into our serviced
land offering, ensuring our focus on nature and on our environmental impact is
central to the products that we deliver and demonstrating the Harworth Way
Planet Pillar in action.
Last year, recognising that sustainability reporting is mainstream for our
business, we took the decision to move oversight to the main Board, rather
than having it focused on by only a subset of our directors through the ESG
Committee. Aligning development-level reporting through emerging industry
standards and corporate-level reporting via the IFRS' International
Sustainability Standards Board ('ISSB') should improve governance in this
area, this being achieved at Harworth by making oversight of sustainability
reporting the responsibility of the Audit Committee.
Board updates:
At the 2025 Annual General Meeting, Ruth Cooke, retired from the Board as an
independent Non-Executive Director, having joined in March 2019. My grateful
thanks go to her for her contribution over the years, particularly as we
developed our mixed tenure Residential offering, bringing her very valuable
perspectives as Chief Executive of one of the largest regional housing
associations.
Last September, we appointed Phil Redding as a new independent Non-Executive
Director, bringing significant experience and capability within the industrial
and logistics sector, having served in C-suite positions at both SEGRO and
most recently Tritax. As we pursue opportunities to transform our high-quality
land bank, Phil's track record in scaling UK industrial and logistics
platforms will be of great value to the Board.
On behalf of the Board, my thanks to everyone both within Harworth, and to our
shareholders, partners, advisers, suppliers and contractors, who have made
possible the significant progress we have achieved over the past year, both
bringing sites to fruition and in particular in advancing the developments
that will enable us to deliver growth and meet our strategic targets, whilst
delivering attractive returns over the coming years.
Alastair Lyons
Chair
16 March 2026
Chief Executive's review
The operational progress in 2025 reinforces our core strengths: a high-quality
land bank, a disciplined balance sheet, and a proven delivery platform capable
of generating sector leading returns.
During the year, we progressed actions to improve the quality of our business
and drive long term growth. These actions focussed investment on enabling
works at key I&L sites, including Chatterley Valley (Staffordshire),
Wingates (Greater Manchester), Gascoigne Wood (North Yorkshire) and Skelton
Grange (South Yorkshire). We now have our largest ever portfolio of
substantially complete serviced land with the capacity to deliver c. 4.0m sq
ft, opening up optionality for delivery of development and value realisation.
We progressed the works at Skelton Grange (West Yorkshire) to deliver serviced
land for a hyperscale data centre for Microsoft, where we expect a further
£53.2m payment, for the second phase of the sale in the next 12 months. On
the back of this significant transaction, we have been scaling our
power-enabled land portfolio, building on our track record in developing
industrial sites. We have been actively pursuing a portfolio totalling 0.8GW
of power connections, either conditionally secured or in pipeline with Network
Operators, capable of supplying data centres and power-intensive sectors, over
the next five to ten years.
In January, we reconfirmed our ability to grow EPRA NDV to £1bn and announced
an extension to the delivery timeline to between end 2028 and end 2029 to
reflect the impact of ongoing macroeconomic weakness and resulting investor
and business uncertainty, which has lengthened timings to complete deals. Our
conviction in our ability to continue to unlock value across our land bank and
execute on high value transactions, including power-enabled land, remains
unchanged, and we are encouraged by a 1.6m sq ft pipeline of strong interest
across our I&L land and property portfolio, ensuring we are well placed to
capture the positive momentum observed following the November 2025 UK Budget
and emerging improvements in industrial market fundamentals. With geopolitical
uncertainty increased in recent weeks, following the escalation of conflict in
the Middle East, we are monitoring the impact on interest rates and the
potential inflationary impact feeding through to the UK economy which if
sustained could impact the timing of our plans. We remain committed to
delivering our strategic objectives in the face of challenging market
conditions and continue to focus on the areas we can control to drive our land
bank forward and accelerate the delivery of our sites whilst achieving our NZC
ambitions.
Operational performance
Having launched our strategy in 2021 to grow EPRA NDV to £1bn, we have
followed a clear road map and transparent set of growth drivers against which
to judge our progress, as set out in the table below.
Growth drivers Metric 2020(1) 2024 2025 Ambitions by end of 2027
Reposition core Investment Portfolio Grade A as % of portfolio value 20 63 76 100% Grade A
Increase capacity for I&L developments Sq ft of I&L built/ land sold (m sq ft) C: 0.2(3) C: 0.1 C: 0.3 0.8m sq ft run-rate (average per annum)
E: 0.4
E: 3.1(4)
E: 4.0(5)
Accelerating Residential sales & broadening range Residential 862(3) 2,385 1,837 2,000 plots
plot sales
(average per annum)
Scaling up through land acquisition and promotion Years of land supply remaining 12-15 years 12-15 years 12-15 years Maintain land supply of 12-15 years
Ambitions beyond 2027
Grow EPRA NDV EPRA NDV (£m) 515.9(6) 719.5 728 £1bn by end 2028 to end 2029(7)
Grow Investment Portfolio IP (£m) 221.4(8) 297.2 305.0 £0.9bn by end of 2029
1. Targets announced 2021. FY20 used as baseline | 2. C = completed and land
sold; E: enabling works completed or underway | 3. Annual average 2015 to 2020
| 4. Total enabling works in 2024 included 1.3m sq ft of works completed and
1.8m sq ft underway at year-end | 5. Total enabling works in 2025 included
2.2m sq ft of works completed and 1.8m sq ft underway at year-end | 6. EPRA
NDV at 31 December 2020 | 7. Announced in 19 January 2026 trading statement
that the timeline has extended out to a range of between the end of 2028 to
end of 2029 | 8. Announced H2 2024. FY2023 of £221.4m is used as baseline.
I&L delivery
Our Investment Portfolio stood at £305.0m at 31 December 2025, comprising 33%
of the overall portfolio. Repositioning our Investment Portfolio to modern
Grade A continues to progress and stood at 76% by value (64% by area), from a
starting point of 23 % by value, five years earlier. In the year, we
successfully delivered on direct development of new units and made asset
sales, which were either of secondary assets or where we had already maximised
value through asset management or re-development initiatives. This places us
well on our way to achieving our 100% Grade A target.
Our I&L Major Developments ('MD') portfolio value was £198.2m, comprising
21% of the overall portfolio. It is the main driver of direct development,
together with our I&L Strategic Land ('SL') portfolio providing the next
generation of Harworth sites. The I&L MD portfolio consists of nine sites
at various stages of development, ranging from early enabling works, like
Wingates (Greater Manchester), to sites ready to develop, like Chatterley
Valley (Staffordshire) and Gateway 36 (South Yorkshire). During the year, we
completed direct developments at the AMP (South Yorkshire) and Droitwich
(Worcestershire) and transferred these Grade A units from MD to the Investment
Portfolio. Land with capacity to deliver 4.0m sq ft has had enabling works
completed or significantly progressed.
Our target is to enable land with a capacity to deliver an 800,000 sq ft
run-rate of I&L space by 2027 and a cumulative total of 4m sq ft. We plan
to develop this in part for our Investment Portfolio, with the remainder to be
delivered via a number of potential routes:
· Traditional serviced land sales
· Built-to-suit (serviced land sale with a development management
fee), or
· Forward funding (serviced land sale with a development management
and asset management fee)
Regardless of the route, our enabling works create development platforms for
vertical construction and are a critical component of creating value, driving
portfolio performance and TAR, which remain our priorities. In the year, we
leveraged our balance sheet capacity to invest in our sites, creating service
land parcels that we believe will drive the greatest value for shareholders.
Accelerating the delivery of our high-quality land bank is a key skillset and
fundamental to our business model. Both the quality of the land bank and our
ownership structure have a role to play. We are increasingly pursuing more
capital light ownership, including strategic partnerships, to ensure we are
well placed to deliver product into the market and optimise returns as well as
looking to work with external capital sources.
Data centres and power-enabled land
The North and Midlands are well positioned for such development offering a
combination of power connection capability, fibre backbones, skills and lower
land value, and at this point in the cycle are capable of creating superior
risk-adjusted returns. Since early works began on Skelton Grange as a possible
data centre site, we have been reviewing our portfolio to identify further
opportunities.
Power is the critical component to meeting emerging sector demand, such as
data centres, and we have been working on building a power-enabled land bank
within our Strategic Land and Major Developments portfolio for a number of
years, accelerating value creation potential through accessing power companies
and data centre operators, securing power reservations and planning, typically
prior to investment in land servicing costs. This means that we now have 0.8GW
of land and power positions, over half of which are in the power application
system and capable of supplying power-intensive sectors over the next decade.
We have a deep skill set in land assembly, remediation and servicing of
large-scale sites, in house technical and power teams who develop and secure
solutions for both brownfield - former mining and power station sites - and
land that is allocated or can deliver at scale as part of regional growth
plans across our portfolio.
Policy support is reasonable to favourable across our regions, and, where we
see it as a key enabler to support regional growth we will work with local and
Government stakeholders to achieve AI Growth Zone status. Working with all
parties to open sites up, and our land and relationships in this sector, both
with power companies and data centre operators looking for the best sites,
give us meaningful potential to unlock value over the medium-term.
Residential delivery
Our Residential product is an important source of cashflow funding to ensure
we can accelerate our land bank and apply capital to higher growth
opportunities to deliver value. We completed 1,837 Residential plot sales in
the period, in line with our four-year average and off the back of record
sales last year. These sales included 725 plots through PPAs, generating fee
revenue of £3.1m and 1,112 freehold plots at headline sales of £52.0m. A
further 746 Residential plots sales were conditionally exchanged at year-end,
with 155 now complete. Headline sales values were stable, but completions were
at an overall average discount of 4% against June book values. The impact of
macro uncertainty, increased regulatory costs, and a slower sales market
resulted in Residential Major Development valuations reducing at the end of
the year. Looking ahead, there remains a short supply of high quality
consented serviced land and the potential for demand-side stimulus to have a
positive impact on the housing market.
Since 2020, we have sold over 9,000 plots to housebuilders or affordable
housing providers and at year-end, our land bank had 3,065 consented plots
remaining, reduced from 9,355 plots in 2020, now comprising 10% of the
residential land bank of 29,386 plots. Our residential strategy has been to
work through this mature consented land bank more quickly as this part of the
portfolio has a higher carrying value with value gains created through
planning and early-stage place-making.
Going forwards, we remain focussed on securing planning approval for the 9,085
plots that are currently in the planning pipeline, realising value through
planning and using capital light and partnership structures for delivery. We
are committed to pursuing the highest risk-adjusted returns by continuing to
recycle capital from our residential sites to reinvest into our development
pipeline, targeting increasing our I&L portfolio weighting to 85% by 2029.
Our markets
Our high quality strategic landbank gives us the ability to focus on growth
sectors through the cycle and our current strategic focus is to shift the
weighting of the portfolio into the industrial & logistics market, with
70% of our portfolio currently in I&L and the remaining predominantly in
Residential. These markets remain critical to the UK's economic growth
continuing to face structural undersupply. Our focus and ambition to grow the
portfolio I&L weighting to 85% underpins our growth though this phase of
the cycle, especially in light of the impact on the Residential market of
global macro and increased geopolitical uncertainties witnessed in 2025,
combined with regulatory pressures.
Macro uncertainty weighed heavily on investor and occupier sentiment
throughout 2025, from trade tariffs impacting confidence in large
international businesses in the first half, to UK businesses waiting for the
late Budget to be issued in the autumn. This resulted in delays in our sales
transactions which were almost entirely second half weighted with a high
proportion completing in the final quarter.
Industrial & Logistics
Industrial and logistics assets remain amongst the favoured real estate
sub-sectors with continued rent growth and stable yields for prime industrial
assets in all regions.
Occupier demand for I&L assets in 2025 was dominated by supply chain
reshoring and manufacturing alongside logistics requirements which continued
to push rents forwards. We see both advanced manufacturing and defence as
growing trends in the industrial market and we anticipate these sectors will
drive more manufacturing take-up in the medium term, a trend that aligns well
with our portfolio.
According to JLL, Grade A big box logistics take-up was up 9% year-on-year and
up 27% over the pre-COVID average, reaching 24.5m sq ft. Speculative take-up
was 8.7m sq ft with Grade A supply down 9% on H1-2025 and 4% on 2024. Aligned
with our own strategy of reducing speculative build, floorspace speculatively
under construction fell to 5.6m sq ft, down 54% year-on-year. We let 379,000
sq ft space in 2025, with demand picking up at the end of the year post
Budget, although transaction timelines were prolonged throughout the year.
All these factors combined meant that our regions saw healthy rental growth
with the North and Midlands amongst the UK's most active logistics corridors,
supported by food retail expansion, manufacturing onshoring and relative
affordability in comparison to the South East. Prime headline rents grew by
4.7% nationally, supported by constrained Grade A supply. The North West
benefitted from more attractive rental growth, with prime rents for Manchester
up 9.5% year-on-year. We expect our attractive North West portfolio to benefit
from this growth on sites such as Chatterley Valley, Wingates and our Northern
Gateway JV, where a 6.5m sq ft planning application was submitted in 2025.
Our Investment Portfolio saw like-for-like headline rental growth for lettings
on existing space, renewals and rent reviews completed of 10.4%. This
validates our conviction for high quality Grade A I&L space in strong
locations.
Data centre sites
The UK is Europe's largest and most mature data centre market with strong
connectivity and foreign investment. The Government's recognition of data
centres as 'Critical National Infrastructure' will help to drive sites through
planning and shorten delivery timelines. The UK market is forecast to more
than double by 2030 driven by unprecedented demand for cloud services, AI
computing, advanced manufacturing and public sector digitalisation and data
storage and our regional markets are set to benefit. The North is increasingly
recognised as a strategically important regional data centre market, driven by
London capacity constraints, improving power availability and targeted
government support. Greater Manchester and Yorkshire are emerging as key
secondary growth markets, supported by grid reinforcement and an increasing
share of new capacity and access to renewable energy. Combined with lower land
costs and strong local authority alignment, investors are increasingly looking
to invest in these markets.
The regional market is anchored by three clusters of which two are in our
portfolio, Manchester, where our Northern Gateway JV sits, and Yorkshire
(Leeds - Sheffield), where our Skelton Grange site for Microsoft sits. These
sites are a catalyst for economic growth in our regions, with our Skelton
Grange site estimated to deliver c. £4bn of inward investment when the
development completes. This is further supported by a Public First study
quantifying that for the whole of the UK, doubling data centre access
increases Gross Value Added by £36.5bn.
Residential
Macro-economic uncertainty, sticky inflation and relatively high mortgage
borrowing costs slowed down the housing market from the summer, with 2025 UK
house price growth at +0.6%, according to Savills, albeit our regions of the
North West and Yorkshire outpaced the South, at +3.5% and +2.2%, respectively.
Despite Government's positive policy intent, the market has not witnessed a
recovery in planning application consents, with the House Builders Federation
confirming that planning permissions are at their lowest level since 2013 and
expecting many local authorities to fail their Housing Delivery Targets,
suggesting a further squeeze on delivery for the next two years and little to
no change in either Local Plans or Planning Promotion Strategy.
Alongside low house price growth, increased build costs and the regulatory
cost burden of the Future Homes Standard and Building Safety Levy, support
some views that the Government's 1.5m homes target in this Parliament term,
may not be achievable, with Savills predicting between 0.8-0.9m homes built
over the period. Only the North saw a small positive bump in residential
Greenfield land values with Urban down along with the rest of the UK. We see
an increased opportunity to bring land forward as land supply is shrinking in
many key locations with almost 60% of Local Authorities lacking a five-year
housing supply.
The Bank of England eased interest rates four times by a total of 100bps
across 2025, ending the year at 3.75%. However, February's Monetary Policy
Committee (MPC) saw no change, with a delay to further cuts subject to the MPC
satisfying itself that inflation is falling and will hit the BoE's target of
2.0%.
Although medium-term commentators continue to expect house price growth, this
will be underpinned by lower mortgage rates and an easing of how mortgage
regulation is applied. So far, weak sentiment and an increased tax burden with
no demand-side stimulus currently in sight, alongside the potential for
interest rate rises with recent macro events, are expected to limit new build
capacity and house price growth in early 2026. Forecasts suggest subdued 2026
house price inflation of between flat to 4%.
Outlook
We have a clear desire to increase our I&L weighting to 85% by 2029,
having grown from a baseline 57% (end of 2020) to 70% at the end of 2025. This
portfolio sits at an inflection point, benefitting from structural drivers and
emerging sectors which are aligned to our pipeline, underpinned by robust
local and national policy support. We have a strong conviction in the core
market themes driving demand for industrial and logistics and emerging demand
for data centres and advanced manufacturing clusters in our regions.
Positioned at the intersection of reindustrialisation, advanced technologies,
data and clean growth, Harworth is leveraging its strategically located land
bank, power and engineering expertise and proven track record in delivering
advanced manufacturing ecosystems to create value. Our flagship Advanced
Manufacturing Park (South Yorkshire) provides a blueprint for globally
competitive manufacturing hubs, and our pipeline of nationally significant
sites, combined with the Harworth Platform, enables the repeatable delivery of
product to world-leading businesses, as we unlock sites such as Wingates and
Northern Gateway in Greater Manchester.
Our conviction in the potential of our portfolio to deliver attractive
through-the-cycle returns remains strong, underpinned by significant progress
made in establishing a long-term data centre and power-enabled land pipeline,
enabling us to bring product into emerging high-value sectors. Our in-house
power and engineering expertise, and resources deployed to accelerate site
delivery in strong strategic locations with policy support, are essential
ingredients for success. We have been actively pursuing upside opportunities
with c.0.8 GW of power connections, either conditionally secured or in the
pipeline with Network Operators. Together with future applications currently
advancing, these represent significant progress towards near and longer-term
transactions that have the potential to deliver enhanced value gains and
superior returns for investors.
We are in a period of market volatility triggered by global events outside the
control of management teams which, if prolonged, could impact the UK economy
and our ability to deliver our plans within our expected timescales. We are
focussed on what we can do, the strength and quality of our landbank, and the
optionality it gives us to lean into emerging themes.
Harworth is well positioned to deliver attractive returns for shareholders.
Supported by targeted capital investment that enhances liquidity and funding
flexibility across our key sites, we have a clear, deliverable pathway ahead
of us. These foundations give us confidence in achieving our £1 billion EPRA
NDV target and reaching this milestone between the end of 2028 and 2029.
Lynda Shillaw
Chief Executive
16 March 2026
Operational review
The land & property portfolio value totalled £937.2m at 31 December 2025
(2024: £858.8m, 2020: £618.2m) and is weighted 70% to I&L (2024: 63%,
2020: 57%). The Income Generation portfolio makes up 36% of the portfolio
value (2024: 38%, 2020: 44%) and comprises the I&L Investment Portfolio
and Natural Resources & Agriculture, with the remaining 64% being the
Capital Growth portfolio of SL and MD across I&L and Residential. The
portfolio split is set out in the table below alongside movements in the
portfolio value since 2024. The largest contributors to the movements in the
year were development spend in opening sites up and acquisitions net of
disposals, followed by revaluation movements.
Land & property portfolio value Portfolio value movements
(£m) 2025 2024
(£m)
I&L 31-Dec-2024 858.8
Strategic Land 149.3 109.7 Development spend 97.7
Major Developments 198.2 138.1 Acquisitions 40.0
Investment Portfolio 305.0 297.2 Disposals (98.1)
Subtotal I&L 652.5 545.0 Value gains 53.6
Residential Transfers (16.1)
Strategic Land 61.5 61.0 Net JV investment 1.3
Major Developments 192.3 223.8 31-Dec-2025 937.2
Subtotal Residential 253.7 284.8
Total NRS & other 31.0 29.0
Total portfolio value 937.2 858.8
Portfolio value movements
(£m)
31-Dec-2024 858.8
Development spend 97.7
Acquisitions 40.0
Disposals (98.1)
Value gains 53.6
Transfers (16.1)
Net JV investment 1.3
31-Dec-2025 937.2
INDUSTRIAL & LOGISTICS (I&L)
Land portfolio
At 31 December 2025, the I&L pipeline totalled 35.0 m sq ft (2024: 33.6m
sq ft) comprising a consented pipeline of 8.5m sq ft (2024: 8.4m sq ft). The
I&L pipeline & planning progress table to the right sets out the stage
our pipeline had reached at year-end 2025 in comparison to year-end 2024.
More of our pipeline is either consented or in the planning system, at 75%
(2024: 63%). The pipeline was 45% owned freehold, with the remaining 55%
controlled through JV arrangements 12%, options 38% or PPAs 5% (2024: 50%
freehold).
Planning
I&L pipeline & planning progress(1)
(m sq ft) 2025 2024
Pre-planning 8.8 12.5
Draft allocations 1.1 2.9
Allocations 2.9 4.9
Awaiting determination 13.7 4.9
Consented 8.5 8.4
Total pipeline 35.0 33.6
Consented or in the planning system(2) 75% 63%
1. Harworth's share
2. In the planning system includes draft allocations, allocations and awaiting
determination
· In the period, draft allocations were received for 1.1m sq ft (total
draft allocations now 5.8m sq ft). Sites awaiting determination include
Northern Gateway (Greater Manchester), Rothwell (Kettering) and Junction 15
(Northampton).
· As at 31 December 2025, applications totalling 13.7m sq ft across 10
sites were in the planning system awaiting determination. This is up
significantly from year-end 2024: 4.9m sq ft, mainly due to new planning
applications submitted in 2025 for 8.2m sq ft across six sites:
2025 I&L planning submissions Sq ft ('000s) Ownership(1)
1. Northern Gateway (Greater Manchester) NOW | I&L | SL 500 JV
Northern Gateway (Greater Manchester) NOW | I&L | SL 2,750 JV / O
2. Junction 15 (Northamptonshire) MID | I&L | SL / O 1,540 O
3. Diseworth West (East Midlands) MID | I&L | SL | FH 213 FH
Diseworth West (East Midlands) MID | I&L | SL | PPA 437 PPA
4. Rufford (Nottinghamshire) YAC | I&L| SL 283 FH
5. Gonerby (Lincolnshire) YAC | I&L | SL 1,289 O
6. Bennerley (Nottinghamshire) YAC | I&L | SL 1,200 FH
Total 8,212
1. Ownership includes FH: Freehold, PPA: Planning Promotion Agreement, JV:
Joint-venture and O: Option
Land assembly
· At Gateway 45 (West Yorkshire) YAC | I&L | MD, we acquired our JV
partner's 50% holding in what was previously called the Aire Valley Land LLP
JV. Adjacent to our Skelton Grange (West Yorkshire) site, where we are
undertaking enabling works on behalf of Microsoft for its proposed hyperscale
data centre, this tactical acquisition underpins the future growth of the
broader site as the land was recently released from HS2 safeguarding and has
the capacity to deliver up to 0.8m sq ft of I&L space.
Direct development
· At the Advanced Manufacturing Park (AMP) (Rotherham) YAC | I&L |
IP, we completed an 80,000 sq ft unit pre-let to Sheffield-based Technicut, a
global leader in the design and manufacture of high-performance components for
the aerospace industry. This advanced manufacturing facility included the
incorporation of renewable energy through an innovative green lease structure
and transferred into our Investment Portfolio during the period.
· At Droitwich (Worcester) MID | I&L | MD, our largest development
in the year, a 169,300 sq ft of Grade A I&L space, practical completion
was achieved in H2 with a subsequent letting to Uniserve for the entire space
on a 10.25-year term-certain lease with an annualised rent of £1.6m.
· We invested significantly in our sites to create serviced land parcels
and deliver developments, with enabling works now complete or significantly
progressed on sites which have capacity to deliver 5.8m sq ft of I&L
space.
· At year-end, a further 1.8m sq ft of enabling works were underway
primarily at Phase 1, Wingates (Greater Manchester) and at Gascoigne Wood
(North Yorkshire) | YAC | I&L | SL, alongside continuing progress on Plot
2 at Skelton Grange, in support of the £53.2m second phase of the sale to
Microsoft for its proposed hyperscale data centre, targeted for completion in
2027.
Key I&L development sites
Site Site type / Sold or developed Consented / planned Estimated GDV remaining to develop (£) Stage Forecast
Ownership(1)
site completion
(sq ft) (sq ft)
Advanced Manufacturing Park (AMP) (Rotherham) MD / FH 1.9m 0.2m / 0.0m £30m - £40m Direct development or plot sale 2027
Gateway 36 MD / FH 0.4m 0.6m / 0.5m £130m - £150m Direct development or plot sale 2033
(Barnsley)
Chatterley Valley MD / FH 0.0m 1.2m / 0.0m £170m - £190m Land remediation and infrastructure development 2028
(Stoke-on-Trent)
Wingates MD & SL / FH & O 0.0m 1.0m / 1.9m £520m - £580m Land remediation and infrastructure development 2033
(Bolton)
Skelton Grange SL / FH 0.6m 0.5m / 0.3m Confidential Land remediation and infrastructure development 2030
(Leeds)
Gateway 45 MD / FH 0.0m 0.8m / 0.0m £150m-£160m Planning approval 2029
(Leeds)
Cinderhill SL / FH & 0.0m 1.5m / 0.0m £180m - £190m Planning approval 2030
(Derby)
PPA
Gascoigne Wood SL / FH 0.0m 1.5m / 0.5m £270m - £290m Planning approval 2028
(Selby)
Northern Gateway(2) SL / JV & O 0.0m 0.0m / 3.3m Confidential Masterplanning 2029-2038
(Greater Manchester)
N. Yorkshire site SL / O 0.0m 0.0m / 3.3m Confidential Masterplanning 2040
Rothwell SL / FH 0.0m 0.0m / 1.8m £300m - £330m Masterplanning 2029
(Kettering)
Junction 15 SL / O 0.0m 0.0m / 1.5m £260m - £280m Masterplanning 2031
(Northampton)
1. Site type includes SL: Strategic Land, and MD: Major Developments,
Ownership includes FH: Freehold, PPA: Planning Promotion Agreement, JV: Joint
Venture and O: Option
2. Harworth's share of a joint-venture, adjacent to the M62 and close to the
M66, Northern Gateway is the core site of the Atom Valley Mayoral Development
Zone, comprising a mix of freehold and optioned land.
I&L INVESTMENT PORTFOLIO (IP)
The Investment Portfolio has undergone a significant level of activity this
year, particularly in making progress towards becoming 100% Grade A. This sat
at 76% Grade A by value at year-end (2024: 63%, 2020: 20%). A significant
level of lettings, direct development and disposals have contributed.
The ambition to grow the portfolio to £0.9bn by the end of 2029 is being
delivered through our direct development programme where we plan to retain
sites that we develop in the medium term, alongside selective acquisitions and
disposals. The portfolio generates recurring rental income, with the potential
for capital value growth via active asset management delivered in the year. As
a result, the return on capital deployed from the IP was 8.7% for the year
(2024: 12.1%, incorporating an income return of 5.6% and capital value growth
of 3.1%.
At 31 December 2025, the I&L IP was valued at £305.0m, up 3% on the 2024
year-end (2024: £297.2m), reflecting the completion of the Technicut unit at
the AMP (South Yorkshire) and Droitwich (Worcestershire) developments and
subsequent transfers to the Investment Portfolio, as well as valuation gains
reflecting asset management and profit on sales. After a number of disposals
in the year, the portfolio comprised 10 sites covering 2.3m sq ft. Headline
rental income stood at £18.3m (2024: £17.5m) and annual passing rental
income was £14.7m (2024: £15.8m) due to new leases with rent free periods.
The net initial yield stood at 4.6% (2024: 4.8%) and a reversionary yield of
6.2% (2024: 6.5%) demonstrating reversionary potential.
I&L Investment Portfolio
2025 2024 % change
Portfolio value (£m) 305.0 297.2 +3
Number of sites 10 12 -17
Area (m sq ft) 2.3 2.8 -17
Grade A space - by value (%) 76 63 13pp(1)
Grade A space - by area (%) 64 45 19pp(1)
Annual Headline rental income (£m) 18.3 17.5 +5
Weighted average passing rent(2) (£ psf) 6.38 5.90 +8
Grade A ERV(3) (£ psf) 9.84 9.10 +8
WAULT(4) to first break (years) 9.6 10.1 -5
WAULT(4) to expiry (years) 11.2 11.4 -1
EPRA vacancy(5) (%) 1.0 5.6 -4.6pp(1)
Net initial yield (%) 4.6 4.8 -0.3pp(1)
Reversionary yield (%) 6.2 6.5 -0.3pp(1)
1. Percentage points
2. Calculated on occupied space
3. Estimated rental values
4. Weighted average unexpired lease term
5. European Public Real Estate Association vacancy
Asset management
During the year, 1.4m sq ft of total lease activity was completed (2024:
146,000 sq ft), including 379,000 sq ft of new leases (2024: 146,000 sq ft) at
a headline rent of £3.7m. The largest contributors were two new leases at
Droitwich (Worcestershire) to Uniserve for 169,000 sq ft and at AMP (South
Yorkshire) to Technicut for 80,000 sq ft. Like-for-like headline rental growth
for lettings on existing space, renewals and reviews were completed 10.4%
ahead of previous annualised headline rents. Significant letting activity
alongside disposals made in the year resulted in EPRA vacancy reducing to 1.0%
(2024: 5.6%).
Disposals
As part of our strategy to transition the core Investment Portfolio to 100%
Grade A, we will continue to selectively dispose of secondary assets where the
viability to transform or upgrade is limited, and older Grade A assets where
we have delivered our asset management plans. During the period, we sold five
core Investment Portfolio assets for £47.7m, at headline pricing ahead of
book values. We sold four secondary assets, including 761,000 sq ft of income
producing industrial assets and six acres of open storage at Saturn Business
Park, Knowsley (Merseyside). In addition, we sold the McLaren unit at AMP, a
Grade A unit we built in 2018. The sale was part of our completing our asset
management plans and diversifying our exposure at the AMP (South Yorkshire) as
the Technicut unit (80,000 sq ft) was transferred in during the period.
Investment Portfolio disposals
Site Location Region Ownership Area (sq ft)
A19 Business Park North Yorkshire YAC FH 61,000
Brierley Hill West Midlands MID FH 373,000
Sherburn in Elmet West Yorkshire YAC FH 252,000
Knowsley(1) Merseyside NOW FH 6 acres
AMP - McLaren unit South Yorkshire YAC FH 75,000
1. Saturn Business Park, Knowsley sold six acres of open storage. Continue to
hold remaining 29 acres and income producing industrial unit
Investment Portfolio sites
Site Location Region Ownership Area (sq ft)
Adv. Manufacturing Park (AMP) South Yorkshire YAC FH 368,000
Bardon Hill Leicestershire MID FH 339,000
Catalyst South Yorkshire YAC FH 285,000
Bradford West Yorkshire YAC FH 252,000
Knowsley Merseyside NOW FH 422,000
Logistics North Greater Manchester NOW FH 104,000
Multiply Logistics North Greater Manchester NOW 20% JV 87,000
Gateway 36 South Yorkshire YAC FH 110,000
Droitwich Worcestershire MID FH 169,000
Glossop Derbyshire NOW FH 166,000
10 sites 2,302,000
RESIDENTIAL PORTFOLIO
At 31 December 2025, the Residential pipeline totalled 29,386 plots (2024:
31,264 plots) including 3,065 consented plots (2024: 4,568 plots). The
Residential pipeline & planning progress table below shows the stage our
pipeline had reached in comparison to year-end 2024. The pipeline that is
either consented or in the planning system sits at 45%, consistent with last
year-end. The pipeline was 37% owned freehold, with the remaining 63%
controlled through JV arrangements 14%, options 10% or PPAs 39% (2024: 41%
freehold), continuing our strategy of increasingly favouring more capital
light ownership structures to facilitate growth and maximise returns.
Planning
Residential pipeline & planning progress(1)
(m sq ft) 2025 2024
Pre-planning 16,116 17,035
Draft allocations 84 2,275
Allocations 1,036 5,250
Awaiting determination 9,085 2,136
Consented 3,065 4,568
Total pipeline 29,386 31,264
Consented or in the planning system(2) 45% 46%
1. Harworth's share
2. In the planning system includes draft allocations, allocations and awaiting
determination
At 31 December 2025, 9,085 plots across 10 sites were awaiting determination
in the planning system, a significant increase over the previous year (2,136
plots over five sites). The increase reflects planning applications submitted
in 2025 across seven sites:
2025 Residential planning submissions Plots Ownership(1)
1. Coalville (Leicestershire) MID | R | MD 290 FH
2. Cefn Park (Clwyd) NOW | R | PPA 900 PPA
3. Diseworth West (East Midlands) MID | R | SL | FH 744 FH
Diseworth West (East Midlands) MID | R | SL | PPA 1,531 PPA
4. Crewe West (Cheshire) NOW | R| SL | O 660 O
5. Rufford (Nottinghamshire) YAC | R | FH 400 FH
6. Crimea Farm (Nottinghamshire) YAC | R | PPA 165 PPA
7. Grimsby West(2) (Lincolnshire) YAC | JV | SL 508 JV
Grimsby West(2) (Lincolnshire) YAC | JV | SL / O 2,170 JV / O
Total 7,368
1. Ownership includes FH: Freehold, PPA: Planning Promotion Agreement, JV:
Joint-venture and O: Option.
2. Insert description of Grimsby West ownership via JV and option
Key Residential development sites
Site Site type / Stage Forecast
Ownership(1)
site completion
Sold Consented / planned
(plots) (plots)
Waverley MD / FH 2,727 244 / - Mixed tenure delivery or plot sale 2025
(Rotherham)
Staveley SL / FH - - / 950 Masterplanning 2032
(Chesterfield)
Rossington MD / FH 927 273 / 206 Mixed tenure delivery or plot sale 2027
(Doncaster)
Stewartby MD / FH - 1,000 / - Planning approval 2029
(Bedford)
Ironbridge MD / FH 312 688 / 350 Mixed tenure delivery or plot sale 2030
(Telford)
Coalville MD / FH 1,738 278 / 290 Mixed tenure delivery or plot sale 2027
(Leicester)
Diseworth SL / FH & PPA - - / 2,275 Masterplanning 2035
(East Midlands)
Cinderhill SL / FH & PPA - 150 / 1,200 Planning approval 2039
(Derby)
Grimsby West SL / JV - - / 3,044 Acquisitions and land assembly 2044
(Grimsby)
1. Ownership includes FH: Freehold, PPA: Planning Promotion Agreement, JV:
Joint-venture and O: Option. Site type includes SL: Strategic Land and MD:
Major Developments.
Residential plot sales in-line with four-year average
We operate a diversified serviced land sales model including freehold serviced
land, mixed-tenure products such as social housing, build-to-rent and senior
living. These sales can be freehold as well as through PPAs, which generate
fees.
Off the back of record sales volumes in 2024, we completed 1,837 Residential
plot sales in 2025, comprising 725 plots through PPAs generating fee revenue
of £3.1m, and 1,112 freehold plot sales at headline sales totalling £52.0m.
At year-end, a further 746 Residential plots had conditionally exchanged, of
which 155 have since completed, demonstrating that despite market headwinds,
our de-risked residential serviced land product continues to progress,
generating important cashflows for the business.
NATURAL RESOURCES PORTFOLIO
At 31 December 2025, the Natural Resources portfolio had a value of £19.9m
(2024: £21.5m) and headline rental income of £1.8m (2024: £2.1m). The
portfolio comprises sites used for a wide range of energy production,
including wind and solar energy, battery storage, and reforestation schemes,
delivered as part of our Energy & Natural Capital strategy. The aim is to
leverage our land and property to grow this portfolio, alongside strategic
partners where appropriate, through developing renewable energy generation
solutions and other sustainability initiatives such as battery storage, solar,
EV charging, multi-fuel hubs and reforestation/rewilding. The strategy has a
wider focus on embedding these energy concepts and future-proofing principles
across all Harworth sites to maximise energy availability and resilience,
create economic value, and help fulfil the Group's NZC ambitions.
As part of our strategy to deliver our serviced land product as a responsible
developer, alongside addressing developers' challenge to meet Biodiversity Net
Gain legislation, we have taken a sector leadership position, launching and
managing our first registered Biodiversity Gain Habitat Bank at our
residential site at Killamarsh in Derbyshire. On this site, as part of the
sale of a parcel of serviced land to a housebuilder, we were able to sell BNG
units on the wider land at the same time. We retain some BNG units on this
site and see the potential to drive growth in future years as this market
continues to develop, issuing biodiversity units to meet our own obligations
and allocating any surplus units to our other projects alongside selling units
to other developers. During 2025 we established Harworth's second Habitat
Bank, a regional first. Located on the former spoil tips of the historic
Allerton Bywater Colliery, this 112-acre site has been secured through a
Section 106 agreement with Leeds City Council - the first of its kind within
this local authority area.
Financial review
Overview
Total Accounting Return and Balance sheet
Our primary metric, Total Accounting Return, was 1.7% for 2025, representing a
decrease from 9.1% in 2024. This reflected strong performance across
Industrial & Logistics Strategic Land and Major Developments as well as
our Investment Portfolio, driving value gains of £71.3m, materially offset by
value losses of £26.8m across residential major development reflecting the
impact of residential market weakness and cost pressures within some of our
residential major developments.
The strong I&L performance reflected the impact of management actions
progressing sites through the planning system and investing in infrastructure
as well as completing and letting of direct development. The Group gained full
control of the Gateway 45 site adjacent to our existing Skelton Grange site,
acquiring the remaining ownership of the Aire Valley Land joint venture for
£20.0m leading to its de-recognition as a joint venture and full
incorporation into the Group balance sheet during the year. Cadence in moving
through Residential Major Development sites was maintained despite challenges
resulting from the timing of the UK budget and market conditions: however, the
impact of lower pricing and cost pressures negatively impacted valuations with
sales achieving less than prior book values. Residential sales continue to
provide an important source of capital which is redeployed in line with our
strategy to increase the weighting of our portfolio to 85% I&L by 2029.
Combined with asset management initiatives across our Investment Portfolio,
this performance resulted in EPRA NDV per share increasing by 0.9% to 224.4p
(2024: 222.3p). Excluding the impact of EPRA adjustments which uplift
Development Property values to fair value, the statutory net asset value of
the Group grew by 1.1% to £699.0m (31 December 2024: £691.7m).
Jones Lang LaSalle, Savills and BNP Paribas, our independent valuers,
completed a full valuation of our portfolio as at 31 December 2025, resulting
in revaluation gains of £53.6m (2024: gains of £86.0m), including the
movement in the market value of development properties. These external
independent valuations have regard to conditions in the Residential and
I&L markets as well as the positive impact of management actions at our
sites. Outside the valuation movements, losses on sales were £9.0m (2024:
profit of £11.2m). These losses included the allocation of increased site
wide infrastructure costs to sales completed in prior periods on a small
number of mature residential sites. Overall, this led to net value gains of
£44.5m (2024: £97.2m gains).
Income Statement
Sales of serviced land and property, in addition to income from rent,
royalties, development and other fees, resulted in Group revenue of £129.8m
(2024: £181.6m).
Revenue from the sale of Residential serviced land was £58.7m (2024: £92.2m)
reflecting continued demand for the Group's de-risked land products but within
a weaker residential market. Development revenues of £42.0m (2024: £18.7m)
were driven by higher activity delivering our Affordable Housing residential
product, reflecting our continued focus on accelerating through our sites, as
well as development on behalf of Microsoft at Skelton Grange. In addition,
residential Planning Promotion Agreement (PPA) revenue contributed £4.7m
(2024: £0.6m) reflecting fees from sales under PPAs.
Revenue from Income Generation increased to £25.0m (2024: £21.5m) as a
result of higher rental income within the Investment Portfolio from the
completion and letting of direct development, full year revenue from the
Catalyst portfolio acquired during 2024, and asset management activity:
like-for-like annualised headline rental income grew by 10.4% (2024: 4.9%).
The Natural Resources portfolio included revenue from the sale of BNG units
totalling £1.3m (2024: £nil).
Total property sales, an APM, which incorporate proceeds from the sales of
investment properties, assets held for sale ('AHFS'), and overages, amounted
to £115.0m (2024: £215.8m) with the drop primarily reflecting the sales at
Skelton (£47.9m) and Ansty (£53.5m) during 2024. These large sales can take
several years to put together with Ansty completing ahead of the original
budgeted timeframe of 2025.
The Investment Portfolio value increased to £305.0m at the end of 2025 (2024:
£297.2m)reflecting the completion and letting of direct development at
Droitwich and at the Advanced Manufacturing Park, Rotherham, as well as the
impact of revaluation gains driven by new lettings, asset management and
market rental growth, offset by the £47.7m disposals described above. The
Group is targeting an Investment Portfolio of approximately £0.9bn by the end
of 2029 through a combination of retained developments and selective
acquisitions, with the additional target of this portfolio becoming 100% Grade
A by the end of 2027.
The fair value of investment properties increased by £47.2m (2024: £60.8m
increase), which resulted in an operating profit of £21.6m (2024: £74.6m)
and profit after tax of £9.5m (2024: £57.2m).
Capital allocation and Financing
We have a model that is predominantly self-funded with sales of serviced land
and property each year, providing the funding for our on-balance sheet spend
for the following year, alongside which we put into place partnerships and
third-party funding structures. The cash proceeds from sales completed in 2024
were reinvested this year into site delivery across I&L through enabling
and infrastructure works and completing direct development, as well as
acquiring the remaining 50% interest in our Aire Valley Land joint venture.
Over 2025, we generated proceeds through sales of serviced residential land
and secondary I&L Investment Portfolio properties, improving the quality
of the portfolio and recycling capital for investment into higher returning
parts of the portfolio.
As a result of our spend alongside lower net sales proceeds, net debt
increased to £145.9m (31 December 2024: £46.7m) resulting in a Net LTV at 31
December 2025 of 15.6% (31 December 2024: 5.4%). Whilst we have deployed more
leverage than in previous years, this is well within our self-imposed maximum
target of 20% at the end of the year and at 31 December 2025, the Group had
available liquidity of £127.1m (31 December 2024: £192.4m).
During the year, the Group entered into a new four year £275m Revolving
Credit Facility (RCF) with NatWest, Santander and HSBC, replacing the previous
RCF with an increased facility limit and improved terms including pricing. The
new RCF was agreed with a £50m uncommitted accordion facility and Harworth
has the option to extend the term to five years. Since year-end, we have put
in place interest rate hedging on borrowings of £50m, representing around a
third of our year-end debt position and further hedging continues to remain
under review. Alongside the new RCF, we continue to use infrastructure and
direct development loans to fund activity on our sites. At the year-end the
Group had an undrawn development loan provided by the North West Evergreen
Fund, this will provide up to £26.2m in debt funding in support of
development at our Wingates Major Development I&L site.
Presentation of financial information and alternative performance measures
As our property portfolio includes development properties and joint venture
arrangements, Alternative Performance Measures ('APMs') can provide valuable
insight into our business alongside statutory measures. In particular,
revaluation gains on development properties are not recognised in the
Consolidated Income Statement and the Balance Sheet. The APMs outlined below
measure movements in development property revaluations, overages and joint
ventures. We believe that these APMs assist in providing stakeholders with
additional useful disclosure on the underlying trends, performance and
position of the Group.
Our key APMs are:
· Total Accounting Return: a measure of the Group's return, calculated as
the movement in EPRA NDV plus dividends per share paid in the year expressed
as a percentage of opening EPRA NDV per share.
· Total Property Return: a measure of the ungeared return for the
property portfolio calculated as the change in capital value, less any capex
incurred, plus net income, expressed as a percentage of capital employed over
the period concerned, calculated in line with the MSCI Property Index
Methodology from 2025.
· EPRA NDV per share: EPRA NDV is an EPRA metric that represents a net
asset valuation where development property is included at fair value rather
than cost and deferred tax, financial instruments and certain other
adjustments are calculated to the full extent of their liability net of any
resulting tax. EPRA NDV per share is EPRA NDV divided by the number of shares
in issue at the end of the year (less shares held by the Employee Benefit
Trust or Equiniti Share Plan Trustees Limited to satisfy Restricted Share
Plan, Share Incentive Plan and Deferred Share Bonus awards).
· Value gains: the realised profits from the sale of properties and
unrealised profits from property valuation movements including joint ventures,
and the mark-to-market movement on development properties and overages.
· Net LTV: Group debt net of cash held expressed as a percentage of
portfolio value.
A full description of all non-statutory measures is set out in the appendix to
the financial statements and reconciliations between all statutory and
non-statutory measures are provided in the same appendix. From December 2025,
the Group is reporting an additional APM, Total Property Return, calculated in
line with the MSCI Property Index Methodology. This provides increased
information to shareholders on the Group's relative performance and supports
the implementation of relative operational performance measures for the
short-term and long-term incentive schemes under the Remuneration Policy. Our
financial reporting is aligned to our business units of Capital Growth and
Income Generation, with any items that are not directly allocated to specific
business activities held centrally and presented separately.
Income Statement
2025 2024
Capital Income Generation Central Overheads Total Capital Income Generation Central Overheads Total
Growth
£m
Growth
£m
£m £m £m
£m £m £m
Revenue 104.8 25.0 - 129.8 160.1 21.5 - 181.6
Cost of sales (111.8) (5.4) - (117.2) (145.8) (4.7) - (150.5)
Gross profit (7.0) 19.5 - 12.6 14.2 16.8 - 31.1
Administrative expenses (6.8) (2.1) (27.4) (36.3) (6.4) (1.1) (25.7) (33.2)
Other gains/(losses) 41.5 8.0 (3.9) 45.5 59.7 18.4 - 78.1
Other operating expenses - - (0.1) (0.1) - - (1.4) (1.4)
Operating profit/(loss) 27.7 25.4 (31.5) 21.6 67.5 34.1 (27.1) 74.6
Share of profit/(loss) of JVs 3.6 2.8 - 6.4 (0.7) 2.2 - 1.5
Net interest income/(expense) 4.4 0.2 (15.2) (10.6) 2.9 0.1 (9.7) (6.7)
Profit/(loss) before tax 35.7 28.3 (46.6) 17.4 69.7 36.5 (36.8) 69.4
Tax charge - - (7.9) (7.9) - - (12.1) (12.1)
Profit/(loss) after tax 35.7 28.3 (54.5) 9.5 69.7 36.5 (48.9) 57.2
Note: There are minor differences on some totals due to roundings
Revenue in the year was £129.8m (2024: £181.6m), of which Capital Growth
contributed £104.8m (2024: £160.1m) and Income Generation £25.0m (2024:
£21.5m).
Capital Growth revenue of £104.8m comprised revenue from the sale of
development properties, development revenue, and fee income. The sale of
development properties of £56.9m (2024: £140.3m) was lower in 2025
reflecting completion of the Plot 1 transaction at Skelton Grange in 2024. In
2025, the sale of development properties largely related to the sale of
residential serviced land. Completed residential land sales were lower due to
market conditions, which impacted pricing achieved, as well as including a
higher proportion of PPA sales this year. Development revenue of £42.0m
(2024: £18.7m) substantially relates to the delivery of the Group's
Affordable Housing residential product and development work on behalf of
Microsoft at Skelton Grange. Capital Growth revenue also included fees from
Planning Promotion
Agreements of £4.7m (2024: £0.6m).
Revenue from Income Generation mainly comprised property rental and royalty
income from the Investment Portfolio, Natural Resources and Agricultural Land.
Revenue of £25.0m (2024: £21.5m) was £3.5m higher in 2025, due to a full
year of revenue from the Catalyst portfolio acquired in Q4 2024, and the
completion of an 80,000 sq. ft. pre-let development at the AMP, alongside
asset management initiatives. Like-for-like headline rent (excluding the
impact of acquisitions, completed development and disposals) from the
Investment Portfolio increased by 10.4% (2024: 4.9%) during the year,
following letting of previously vacant assets, lease regears and rent reviews
on existing assets. The total headline annualised rental income for the
Investment Portfolio, including the impact of disposals, increased by 4.6%% to
£18.3m in 2025 (2024: £17.5m). Revenue also included the sale of BNG credits
of £1.3m (2024: £nil).
Cost of sales comprises the inventory cost of development property sales, site
wide infrastructure costs, costs incurred in undertaking development on behalf
of others including affordable residential delivery and development work for
Microsoft at Skelton Grange as well as the direct and recoverable service
charge costs of the Income Generation business. Cost of sales decreased to
£117.2m (2024: £150.5m), of which £65.0m (2024: £126.3m) related to the
inventory cost of development property sales and impairments resulting from
increased site wide infrastructure costs on residential sites. The challenging
residential market impacted pricing on sales of development property which,
coupled with some limited site-specific cost increases primarily in the first
half of the year, resulted in an overall gross loss for the year within
Capital Growth. In the year, there was an increase in the net realisable value
provision on development properties of £4.9m (2024: £5.7m decrease)
following the valuation process as at 31 December 2025.
Administrative expenses increased in the year by £3.1m to £36.3m (2024:
£5.8m increase). This was due to higher salary expenses, reflecting increased
employee numbers and inflationary increases, alongside increased technology
spend as part of our digital transformation programme (£1.8m vs £0.5m in
2024), offset by lower legal and professional costs. Central administrative
expenses include the cost of central teams that support the operational
business. Administrative expenses are a focus for 2026 as we seek to ensure
they are proportionate to value creation and appropriate for the business
model.
Other gains comprised a £47.1m net increase (2024: £60.4m net increase) in
the fair value of investment properties and assets held for sale ('AHFS')
combined with the profit on sale of investment properties, AHFS and overages
of £2.3m (2024: £17.7m profit).
Joint venture profits of £6.4m (2024: £1.5m profits) included valuation
gains at the Aire Valley Land Joint Venture prior to de-recognition as part of
the acquisition of the remaining interest during the year, as well as at
Multiply Logistics North. Value gains/(losses) on a non-statutory basis are
outlined below.
Non-statutory value gains/(losses)
Value gains/(losses) are made up of profit on sale, revaluation gains/(losses)
on investment properties (including joint ventures), and revaluation gains/
(losses) on development properties, AHFS and overages. A full description of,
and reconciliation between, statutory and non-statutory value gains can be
found in Note 2 and the appendix to the consolidated financial statements can
be found in Note 2 and the appendix to the consolidated financial statements.
2025 2024 31 Dec 25 31 Dec 24
Profit /(loss) Reval. gains/ Total Profit /(loss) Reval. gains/ Total Total valuation Total valuation
Category on sale (losses) on sale (losses)
Capital Growth
Residential Development (10.1) (18.6) (28.7) (2.9) 20.3 17.4 192.3 223.8
Major Developments
Industrial & Logistics Major Developments Mixed (0.3) 36.4 36.0 0.7 5.8 6.5 198.2 138.1
Residential Investment (0.1) 2.0 1.9 - 8.6 8.6 61.5 61.0
Strategic Land
Industrial & Logistics Investment (0.4) 29.0 28.5 12.6 31.4 44.0 149.3 109.7
Strategic Land
Income Generation
Investment Portfolio Investment 1.0 8.2 9.1 0.8 19.6 20.4 305.0 297.2
Natural Resources Investment 1.0 0.2 1.1 - 0.5 0.5 19.9 21.5
Agricultural Land & other Investment - (3.5) (3.5) (0.1) (0.3) (0.4) 11.0 7.5
Total (9.0) 53.6 44.5 11.2 86.0 97.2 937.2 858.8
Notes: There are some minor differences on some totals due to
roundings. Profit/(loss) on sale is stated net of the impact of transaction
fees incurred.
Total Property Sales in 2025 were £115.0m generating a loss on sale of £9.0m
(2024: £11.2m profit). The loss was concentrated in Residential Major
Developments where the market was impacted by the late UK budget and lack of
buyer stimulus. As a result, headline sales pricing was marginally below book
value before trans-action costs and when discounting of deferred consideration
to present value, and retentions not recognised on completion were taken into
account this generated a loss on sale of around 8%. The £9.0m loss on sale
incurred included £8.3m increases in estimated costs for the completion of
site wide works at a small number of mature residential sites, impacting the
proportional share of site wide costs allocated to prior period sales at the
point-of-sale completion. The loss on sale was partially offset by profit on
completion of retention works £4.1m (2024: £2.2m) relating to prior period
sales.
Revaluation gains were £53.6m (2024: £86.0m) and are outlined in the table
below.
2025 2024
£m £m
Increase in fair value of investment properties 47.2 60.8
Decrease in value of assets held for sale and owner-occupied property (4.0) (0.4)
Movement in net realisable value provision on development properties (5.8) 1.3
Contribution to statutory operating profit 37.5 61.7
Share of profit of joint ventures 6.4 1.5
Unrealised gains on development properties and overages 9.7 22.7
Total non-statutory revaluation gains 53.6 86.0
Note: There are minor differences on some totals due to roundings
The principal revaluation gains and losses across the divisions reflected the
following:
- Industrial & Logistics:
o Valuation gains totalling £65.3m across Major Developments and Strategic
Land driven by planning progress, continued progression on developments,
completion of direct development, occupier and investor demand and improvement
in market rents.
o Revaluation gains on the Investment Portfolio from letting progress and
improvement in market rents.
o While investment yields remained stable during the year, the industrial
& logistics market continued to benefit from rental growth supporting our
I&L Major Development sites, Strategic Land sites and the Investment
Portfolio, alongside the impact of management actions.
- Residential:
o The widely reported challenges in the residential market impacted both the
pricing achieved on sales in year as well as the outcome of the year end
valuations, which coupled with cost pressures, led to total valuation losses
of £16.6m across Major Developments and Strategic Land.
o Despite the challenging environment, including the impact of market delays
driven by the timing of the UK budget, sales were completed achieving headline
pricing marginally below book values with recognised losses on sales including
the further impact of transaction costs, discounting of deferred consideration
to present value, and retentions not recognised on completion. These sales
supported cashflow within 2025 with deferred consideration, alongside
exchanged sales, providing greater certainty over 2026 cashflows.
o Cost increases experienced on Residential major development sites,
particularly during the first half of the year in relation to limited site
specific costs, included increases across infrastructure works and
professional fees as well as increases in the expected costs of meeting CIL
and s106 planning obligations.
o Government policy remains focused on significantly increasing the level of
housing delivery but limited focus on the demand side coupled with wider
economic uncertainty has impacted overall pricing.
o Savills reported pressures in the residential development land market,
noting that greenfield values fell by an average of -1.4% in 2025, with the
most significant softening occurring towards the end of the year, as values
fell by -1.2% in Q4.
- Natural Resources: valuations remained stable during the year, with
profit on sale generated through sale of legacy assets with limited future
asset management potential.
- Agricultural Land and Other: experienced a small valuation loss in
relation to owner occupied property during the year. During the year the Group
invested in the construction of a new head office building at our flagship
Advanced Manufacturing Park ('AMP') in Waverley, completing work early in
2026. Alongside creating a fit for purpose sustainable workspace, this enables
the future development or sale of our previous head office site and provides
an anchor to open up the development of Highfield as one of the final phases
of the Waverley site.
Cash and sales
Total property sales, encompassing proceeds from the sale of investment
property, AHFS, overages and PPAs as well as revenue from the sale of
development property totalled £115.0m (2024: £215.8m). Total property
sales comprised:
2025 2024
£m £m
Residential land sales 58.7 97.2
Industrial & Logistics land sales 1.9 101.0
Sales of Investment Portfolio properties 47.7 13.3
Natural resources asset sales 5.7 -
Overages & PPAs 1.0 4.3
Total property sales 115.0 215.8
Cash proceeds from sales in the year were £124.2m (2024: £172.3m) as shown
in the table below:
2025 2024
£m £m
Total property sales 115.0 215.8
Less deferred consideration on sales in the year (32.4) (57.8)
Add receipt of deferred consideration from sales in prior years 41.6 14.3
Total cash proceeds 124.2 172.3
Residential headline sales values reduced to £52.0m (2024: £104.1m)
resulting in lower levels of deferred consideration. Where deferred payment
terms are agreed to, security is maintained to mitigate credit risk.
Tax
The income statement charge for taxation for the year was £7.9m (2024:
£12.2m charge), which comprised a current tax credit of £1.4m (2024: £6.0m
charge) and a deferred tax charge of £9.3m (2024: £6.1m charge).
The current tax is results from profits from the sale of development
properties, investment property, AHFS, profit on the rental of investment
property, royalties and other fees after taking into account overheads and
interest costs. The deferred tax balance is calculated based on the rate
expected to apply on the date the liability is crystallised.
At 31 December 2025, the Group had deferred tax liabilities of £55.2m (31
December 2024: £37.4m) and deferred tax assets of £10.2m (31 December 2024:
£1.5m). The net deferred tax liability was £45.0m (31 December 2024:
£35.9m).
Basic earnings per share and dividends
Basic earnings per share for the year decreased to 2.9p (2024: 17.7p)
reflecting lower increases in valuation of investment properties in 2025, net
losses from sales in the year and higher interest costs partly offset by
higher rental income.
In addition to the interim dividend of 0.538p, the Board has declared a final
dividend of 1.237p (2024: 1.125p) per share, bringing the total dividend for
the year to 1.775p (2024: 1.614p) per share. The recommended 2025 final
dividend and 2025 total dividend represent a 10% increase in line with our
dividend policy for the year to 1.775p (2024: 1.614p) per share.
Property categorisation
Until sites have received planning permission and a specific future use has
been established, the land is held for an undetermined future use and is
classified as investment property. Once planning permission has been obtained
and active development with a view to sale has commenced, the land and
associated properties are reclassified as development properties. Where land
is being developed to hold our Investment Portfolio it remains classified as
investment property.
The table below sets out the top 10 sites by value, which represent 54% of the
total portfolio, split according to their categorisation, including currently
consented Residential plots and commercial space.
Top 10 sites by value
Site Region Use Site BS Progress to date
type
category
Ironbridge (Telford) MID R MD Dev. prop 1,000 Residential units consented, land sold representing 312 units, further
enabling works underway
Continue to progress master planning for the scheme in collaboration with the
SL Inv. prop Local Authority
R
Advanced Manufacturing Park (AMP) (Rotherham) YAC I&L MD Inv. prop 2.1m sq. ft of Industrial & Logistics space consented, 1.9m sq. ft built
or sold.
0.4m sq. ft of Grade A held in Investment Portfolio
I&L IP Inv. prop
Wingates (Bolton) NOW I&L MD Inv. prop Up to 1m sq .ft of Industrial and Logistics space consented with buildings up
to 0.3m sq. ft achievable in Phase 1. Enabling and site infrastructure works
ongoing with completion due Q4 2026.
Work to submit a planning application for a further 1.9m sq. ft is ongoing
R/I&L SL
Inv. prop
Bardon Hill (Leicester) MID I&L IP Inv. prop 0.3m sq. ft of fully-let Grade A held in Investment Portfolio
Catalyst (Rotherham) YAC I&L IP Inv. prop 0.3m sq. ft fully-let
Skelton Grange (Leeds) YAC I&L MD Dev. prop 0.3m sq. ft of I&L space remaining on the retained land.
I&L SL Inv. prop Enabling works are ongoing to program
Chatterley Valley (Stoke) NOW I&L MD Dev. prop 1.17m sq. ft of Industrial and Logistics space consented with single buildings
of up to 0.5m sq. ft achievable.
Enabling and infrastructure site works are substantially complete
I&L MD Inv. prop
Gascoigne Wood (North Yorkshire) YAC I&L IP Inv. prop 1.5m sq. ft of Industrial & Logistics space consented, Infrastructure
works have commenced
Wyke Lane (Bradford) YAC I&L IP Inv. prop 0.3m sq. ft fully-let
Logistics North (Bolton) NOW I&L IP Inv. prop 104k sq. ft owned freehold retained in Investment Portfolio.
I&L IP JV 87k sq. ft controlled through joint venture retained in Investment Portfolio
As at 31 December 2025, the balance sheet value of our development properties
was £195.2m (31 December 2024: £190.9m) and their independent valuation was
£227.5m, reflecting a £32.3m cumulative uplift in value since they were
classified as development properties. In order to highlight the market value
of development properties, and overages, and to be consistent with how we
state our investment properties, we use EPRA NDV, which includes the market
value of development properties and overages less notional deferred tax, as
our primary net assets metric.
Net asset value
31 Dec 2025 31 Dec 2024
£m £m
Properties((1)) 899.4 821.6
Cash 27.1 117.4
Trade and other receivables 12.7 98.2
Other assets 103.0 15.3
Total assets 1,042.2 1,052.5
Gross borrowings (173.0) (164.1)
Deferred tax liability (44.9) (35.9)
Other liabilities (125.3) (160.9)
Statutory net assets 699.0 691.7
Mark to market value adjustment on development properties and overages less 28.3
notional deferred tax
27.8
EPRA NDV 727.3 719.5
Number of shares in issue less Employee Benefit Trust & Equiniti Share 324,141,060
Plan Trustees Limited-held shares
323,640,852
EPRA NDV per share 224.4p 222.3p
(1) Properties include investment properties, development properties, AHFS,
occupied properties and investment in joint ventures.
EPRA NDV at 31 December 2025 was £727.3m (31 December 2024: £719.5m), which
includes the mark to market adjustment on the value of the development
properties and overages. The total Portfolio Value as at 31 December 2025 was
£937.2m, an increase of £78.4m from 31 December 2024 (£858.8m).
The Group's share of gains from joint ventures of £6.4m (2024: £1.5m),
primarily reflects the revaluation gains on The Aire Valley Land LLP joint
venture in the period prior to the acquisition described below, and the
performance of Multiply Logistics North LLP during 2025.
A total of £20.0m, before costs and stamp duty, was paid in March 2025 to
acquire the remaining 50% of the Aire Valley Land LLP joint venture. As a
result of the acquisition, the carrying amount of the investment totalling
£16.1m was derecognised from the Investments in Joint Venture on the balance
sheet and is now shown as a 100% wholly owned Subsidiary. Excluding the gain
on the revaluation of The Aire Valley Land LLP joint venture and its
derecognition, there was a £2.8m increase in the like-for-like value of joint
ventures during 2025.
Trade and other receivables include deferred consideration on sales. At 31
December 2025, deferred consideration of £60.4m was outstanding (31 December
2024: £72.9m), of which 92% is due within one year, the current level being
the result of the lower level of residential land sales completed during 2025:
where deferred payment terms are agreed, the Group maintains security in order
to mitigate credit risk.
Financing strategy
Harworth's financing strategy remains to be prudently geared. The Income
Generation portfolio provides a recurring income source to service debt
facilities and this is supplemented by proceeds from sales.
As part of its strategic plan, the Group maintains a self-imposed target LTV
of below 20% at year ends, with a maximum of 25% in-year, reflecting the
cyclical nature of the Group's cashflows. As a principle, the Group seeks to
maintain its cash flows in balance by funding the majority of infrastructure
expenditure through disposal proceeds, while allowing for growth in the
portfolio.
Debt facilities
A £240m RCF (the Original RCF) had been in place since 2022 with NatWest,
Santander and HSBC and was due to expire in 2027. During November 2025 the
Group entered into a new £275m Revolving Credit Facility ('New RCF') with
NatWest, Santander and HSBC, replacing the Original RCF. The New RCF is for an
initial four-year term, which may be extended to five years at Harworth's
request and includes an uncommitted accordion option which if exercised would
take the RCF to £325m. The new RCF provides significant liquidity and
flexibility to enable the Group to pursue its strategic objectives. The
interest rate on the RCF is based on an LTV ratchet mechanism with a margin
payable above SONIA in the range of 1.95% to 2.25%.
As part of its funding structure, the Group also uses infrastructure financing
provided by public bodies and site-specific direct development loans to
promote the development of major sites and bring forward the development of
I&L units.
The Group had net debt of £145.9m at 31 December 2025 (31 December 2024:
£46.7m). The increase in net debt during the year reflects the significant
investment in, and operational progress on, sites alongside the acquisition of
the remaining interest in Aire Valley Land LLP, partly offset by proceeds from
sales. The movements in net debt during the year are shown below:
2025 2024
£m £m
Opening net debt as at 1 January (46.7) (36.4)
Cash inflow/(outflow) from operations (30.5) 42.6
Property expenditure and acquisitions (82.5) (116.5)
Disposal of investment property, AHFS and overages 53.6 80.0
Net investments in joint ventures (1.3) (1.3)
Interest and loan arrangement fees (14.2) (7.7)
Dividends paid (5.3) (4.9)
Tax paid (9.7) (0.5)
Fixed assets expenditure (10.5) -
Other cash and non-cash movements 1.2 (2.0)
Closing net debt as at 31 December 145.9 (46.7)
The Group's strategy to manage its exposure to interest rate risk is to hedge
the lower of around half its average debt during the year or its net debt
balance at year end. As at 31 December 2025, none of the Group's drawn debt
was subject to interest rate hedging; following the year end, we put £50m of
hedging in place through an interest rate cap to mitigate the risk of interest
rates increasing above 4.5%. We shall continue to monitor projected drawn
debt, and hedging requirements following the refinancing of the Group's RCF in
2025.
As at 31 December 2025, the Group's net LTV was 15.6% (31 December 2024: 5.4%)
within our self-imposed target to be below 20% at year-end. If gearing is
assessed against the value of the income generation portfolio (the Investment
Portfolio and Natural Resources portfolio) only, this equates to a net loan to
income generation portfolio value of 48.5% (31 December 2024: 15.7%). Under
the RCF, the Group could withstand a material fall in portfolio value,
property sales or rental income before reaching covenant levels.
At 31 December 2025, Group liquidity of £127.1m (31 December 2024: £192.4m)
included undrawn capacity under the RCF of £100m (31 December 2024: £75.0m)
in addition to the year-end cash balance of £27.1m (31 December 2024:
£117.4m). Going forward, the RCF, alongside selected use of development and
infrastructure loans where appropriate, will continue to provide the Group
with sufficient liquidity to execute our growth strategy.
Kitty Patmore
Chief Financial Officer
16 March 2026
( )
Key performance indicators
2.1 Financial track record
KPI FY2025 result FY2024 result FY2025
performance commentary
Total Accounting Return (%) 1.7% 9.1% Our Total Accounting Return ('TAR') 'of 1.7% was the result of a 0.9% increase
in EPRA Net Disposal Value per share during the year, as well as payment of
Growth in EPRA NDV during the period in addition to dividends paid, as a 1.663p in dividends. Since 2021, we have delivered cumulative Total Accounting
proportion of EPRA NDV at the beginning of the year. Returns of 44.5%.
EPRA Net Disposal Value ('NDV') per share 224.4p 222.3p EPRA Net Disposal Value per share ('EPRA NDV') grew 0.9% due to higher
valuations within our I&L portfolio, with positive management actions
A European Public Real Estate Association ('EPRA') metric that represents a driving value as sites progressed through planning and development, partially
net asset valuation where development property is included at fair value offset by valuation losses on Residential Major Development sites, impacted by
rather than cost and deferred tax, financial instruments and other adjustments inflationary pressures, some limited site-specific cost increases and
as set out in Note 2 and the appendix to the financial statements, are challenging market conditions.
calculated to the full extent of their liability.
Total Property Return 8.4% 12% Total Property Return ('TAR'), calculated by MSCI of 8.4% compares to the MSCI
UK Annual Property Index of 5.6%. Our return reflects a strong performance
A measure of the ungeared return for the portfolio calculated as the change in across our I&L portfolio, including Strategic Land, Major Developments and
capital value, less any capex incurred, plus net income, expressed as a Investment Portfolio, reduced by returns on Residential land.
percentage of capital employed over the period concerned, calculated by MSCI.
Net LTV 15.6% 5.4% Our Net Loan to Portfolio Value ('LTV') increased as we drove significant
investment and operational progress on sites as well as from the acquisition
Net debt as a proportion of the aggregate value of properties and investments. of the remaining 50% interest in Aire Valley Land LLP, with LTV remaining well
within our self-imposed target within year of less than 25% as we completed
sales to provide headroom for reinvestment.
2.2 Strategic track record
KPI FY2025 result FY2024 result FY2025
performance commentary
I&L space developed (m sq ft) 0.3 0.1 In the year we completed 0.3m sq. ft which was transferred to our Investment
Portfolio and now contributes £2.7m to headline annual rent.
The amount of Industrial & Logistics space developed by Harworth, either
speculatively or on a build-to-suit basis for an end occupier or investor,
achieving practical completion during the year.
Total Industrial & Logistics pipeline consented or in the planning system 75% 63% The increase reflects the record-level of planning applications submitted in
(sq ft) the year, with 13.7m sq ft now awaiting determination, compared to 4.9m sq ft
in 2024.
Land in the planning system with an allocation or awaiting determination
carries a lower risk to approval, an important step in value creation, as well
as alongside consented land, this forms our pipeline for future development.
Proportion of Investment Portfolio that is V: 76% V: 63% The proportion of our Investment Portfolio that is
A: 64%
A: 45%
Grade A by value & area
Grade A significantly increased due to the completion of 80,000 sq. ft of
pre-let and 169,000 sq. ft of speculative Grade A direct development during
The proportion of our Investment Portfolio by area that could be classified as the year, coupled with sales of secondary assets.
modern Grade A Industrial & Logistics space. Grade A is a widely used
industry term that is understood to mean 'best in class', space which is new
or relatively new, high-specification and in a desirable location, allowing
the unit to attract a rent that is above the market average.
Number of plots sold 1,837 2,385 We completed the sale of 1,837 Residential plots, 725 plot sales under
Planning Promotion Agreements ('PPAs'), generating fees of £3.1m as revenue,
The number of plots equivalent to land parcel sales to housebuilders or together with 1,112 freehold plot sales generating headline sales of £52.0m,
registered providers during the year. demonstrating continued demand for the Group's residential land products.
2.3 Sustainability track record
KPI FY2025 result FY2024 result FY2025
performance commentary
Location based Scope 1, Scope 2 and Scope 3 business travel (tCO(2)e) 612 690 Location-based emissions reduced from 690 tCO2e in 2024 to 612 tCO2e in 2025.
This 11% year-on-year reduction was achieved through our continued transition
Emissions that are captured by our target to be operationally Net Zero Carbon to a Grade A portfolio, benefiting from energy efficiency measures and the
(NZC) by 2030. targeted use of alternative fuels in our site operations, thereby lowering
overall energy usage.
Proportion of I&L building space developed in year incorporating renewable 100% 100% All new commercial buildings in 2025 included renewable energy sources through
energy provision rooftop solar installations. Over 15,400 sq m of panels have been installed
since 2023, totalling 3,223 kWp with an additional 1,610 kWp installed in
As part of our NZC Pathway, published in 2023, we committed that all new 2025.
commercial buildings would incorporate renewable energy provision.
Principal risks & uncertainties
The Board is responsible for identifying and evaluating the Group's principal
and emerging risks that could potentially impact the execution of our
strategy, business model, future performance, solvency, liquidity or
reputation. The Board conducts a comprehensive review of the Principal Risks
at least twice annually, and additionally whenever there is a material change
in strategy or a significant event that alters the organisation's risk
profile. Any adjustments to the Principal Risks are approved to ensure they
remain consistently aligned with the strategy and with internal and external
factors.
During H1 2025 the Board undertook a comprehensive review and refresh of the
Principal Risks to ensure they remain aligned with our strategic objectives
and are reflective of the evolving external landscape This review adopted a
"first-principles" approach, focusing on strategic objectives and the risks to
achieving them, rather than building on existing Principal Risks, and was
informed by consideration of:
· The "pivot" in our strategy, announced at the 2024 half year,
towards 85% I&L through vertical development delivery and growth in the
Investment Portfolio.
· Early outputs from the enhancement and standardisation of our
'bottom-up' operational risk management framework.
· The current macroeconomic and geopolitical environment.
During H2 2025, further in-depth Principal Risk workshops were conducted with
business risk champions, in alignment with our 'top-down/bottom-up' review
process.
The extensive review process for the Principal Risks over 2025 did not result
in a fundamental revision of the risk profile of the Group. Instead,
notwithstanding the "first-principles" approach, it led to a refinement of the
existing set of Principal Risks.
Below are the material changes made to our Principal Risks.
Changes From Prior Year Risk Commentary
NEW PRINCIPAL RISK Risk 4 - Physical Climate Events Extreme weather events and long-term climate shifts (e.g. storms, floods,
wildfires, temperature extremes) disrupt construction supply chains, impacts
development operations, increases costs, and damages assets.
NEW PRINCIPAL RISK Risk 11 - Digital Transformation Project (DTP) Failure to implement a scalable and integrated digital architecture that
enables operational efficiency, business growth, continuous innovation, and
effective AI adoption.
NEW PRINCIPAL RISK Risk 13 - Government Policy Implementation Challenges in slow and/or inconsistent implementation of Government policy
across our regions alongside devolution and local government reform changing
the landscape in which we (investors and businesses) operate.
NEW PRINCIPAL RISKS Risk 6 - Capital Until recently, these risks were consolidated in a single Capital &
Liquidity risk. We have now separated them to distinguish clearly between:
Risk 9 - Liquidity Capital risk, being an inability to source adequate capital to meet our
strategic growth aspirations; and Liquidity risk, being an inability to
maintain optimal levels of working capital to meet business as usual
obligations.
REVISED PRINCIPAL RISK Risk 10 - Climate Transition and Reporting risk Failure to successfully transition to NZC, leading to non‑compliance with
regulatory and reporting requirements, inability to meet the NZC targets we
set ourselves, and associated reputational damage.
REMOVED PRINCIPAL RISK Availability of and competition for strategic sites Harworth's extensive land bank, development pipeline and investment
strategy mean this is not considered a Principal Risk to achievement of
Harworth's strategic objectives at this stage.
REMOVED PRINCIPAL RISK Counterparties: Investment partners and service providers This risk was consolidated into other principal and emerging risks.
REMOVED PRINCIPAL RISK Statutory costs of development This risk was consolidated into other Principal Risks.
The Group Principal Risk Register
The register incorporates the Principal Risks the Board has identified,
including any emerging risks that could potentially become a Principal Risk to
the Group strategy. Each risk is subject to a consistent risk assessment
methodology, the outputs of which are reflected in a Principal Risk dashboard
which details:
· The scope of, and commentary on, the status of each risk;
· Inherent risk, residual risk, and risk appetite scores to evaluate
the changing status of each risk and monitor the alignment (or misalignment)
of risk appetite and risk profile;
· Mitigation measures that have either been implemented, are in
progress, or are planned. These include "material controls" whose
effectiveness will be reported on in our 2026 Annual Report as per the updated
Corporate Governance Code Provision 29 requirements;
· Key Risk Indicators ('KRIs') used to measure the profile of each
risk: whilst this aspect remains under development, Harworth's ERM function
aims to improve the quantity and quality of KRIs, and to develop a KRI
dashboard for continuous real time monitoring of KRIs where possible.
Assurance over the key controls in place to mitigate Principal Risks to an
acceptable level is obtained via various sources covering all three lines of
defence. The Head of Audit and Assurance manages an assurance map which
identifies what assurance is taken over the effectiveness of material
controls. These controls are in place to mitigate to an acceptable level not
only Principal Risks but also other key financial, operational, compliance,
and reporting risks. Any gaps in assurance identified are used to inform the
36-month rolling internal audit programme. The internal audit programme will
also incorporate selective testing of controls which, whilst not meeting the
threshold for classification as a "material control", are nonetheless
important mitigants of Principal Risks.
Emerging Risks
As the business landscape evolves, emerging risks, such as geopolitical
instability, climate-related disruptions, technological advancements, and
regulatory changes pose significant challenges to long-term resilience.
Effective management of these risks requires proactive identification,
continuous monitoring, and agile response strategies. We are embedding
horizon-scanning techniques and scenario analysis into our risk framework to
anticipate potential threats and opportunities via regular risk workshops
undertaken with the Board. This approach ensures that emerging risks are
escalated promptly, enabling informed decision-making and safeguarding
stakeholder value. Collaboration across functions and leveraging data-driven
insights remain central to strengthening our preparedness for an increasingly
complex risk environment.
One new emerging risk was identified in 2025: Investment Partner Selection and
Management: Flaws in governance and management of stakeholder relationships
impacting operations, availability of capital and costs.
Risk 1 Commentary
Power Infrastructure Capacity Securing power for development sites in the UK has become increasingly
challenging, leading to uncertainties, potential cost increases and project
delays. The rising demand for renewable energy has strained grid
infrastructure, resulting in longer connection timelines. In response,
National Energy System Operator ('NESO') is undertaking the Great Grid Upgrade
comprising 17 major infrastructure projects to upgrade existing networks.
NESO's reforms to the grid connection application process are underway. Whilst
these changes aim to streamline connections, they also introduce new
challenges. The "first ready, first connected" approach to transmission and
generation applications is now in place. The next phase of reform is a pause
in connection applications, which began in January 2025 to allow NESO to
implement the new application process.
Description Mitigation RISK PROFILE
Challenges in securing power infrastructure for Schemes at a viable cost and · Comprehensive due diligence performed at the acquisition stage. Current residual risk rating
timescale.
· Comprehensive power strategy approved by Board as part of the MEDIUM (unchanged from prior year)
underwrite proposal.
· Stakeholder Engagement with NESO, Distribution Network Operators
(DNOs), and Independent Distribution Network Operators (IDNOs) is maintained
through ongoing discussions and reviews of infrastructure forecasts. Insights
gained are used to inform development strategy.
· Via Scheme Gateway Reviews each scheme's power strategy is subject
to ongoing monitoring and, where appropriate, adaptation.
Risk appetite
BALANCED
Target residual risk
MEDIUM (aligned to current risk rating)
Link to strategic priorities
2 3 4 £
Risk 2 Commentary
Planning System The UK planning challenges include delays from an inefficient system, resource
constraints within local authority planning departments, and frequent changes
to government policy. Proposed reforms are, on the whole, but not exclusively,
positive for Harworth: they aim to streamline processes, bolster local
authority resources, restore housing targets, and boost sustainable
development, with goals including the delivery of 1.5m new homes over the next
five years and critical infrastructure projects. However, significant positive
impacts are unlikely until later in the parliamentary term. Industry
engagement and stability are essential for progress. Added complexities come
in the form of land value capture, Net Zero Carbon policies such as in Greater
Manchester, greenbelt and BNG policies, with uncertainties around how these
will be implemented in practice.
Description Mitigation RISK PROFILE
Challenges in obtaining planning permission for schemes impacting financial · Comprehensive planning strategy approved by the Board as part of Current residual risk rating
returns. the underwrite proposal. This ensures that there is a clearly defined strategy
for the site promotion through to securing a planning permission. Ongoing MEDIUM (reduced since prior year)
monitoring and (where appropriate) evolution of the strategy is undertaken via
playbooks and monthly Development Board meetings.
· Ongoing Stakeholder Engagement allows for the strategy to be
informed by evidence including a local authority's housing and employment land
supply, status of current plan, stakeholder mapping and existing strengths and
weaknesses in relationships with key stakeholders in that area. Along with
ongoing stakeholder engagement to ensure confidence in our commitment to
comply with all sustainability obligations including BNG legislation and
regional Net Zero Carbon policy requirements.
· A pre application process is undertaken for high-risk schemes to
allow for areas which need further investigation / analysis to be flagged
ahead of submitting the formal application to ensure a smooth, efficient
process and reducing the risk of delays.
· Planning Performance Agreements are entered into with certain local
planning authorities (where appropriate) which set an agreed framework for
engagement during the planning process to secure a timely determination of the
application.
Risk appetite
OPEN
Target residual risk
MEDIUM (aligned to current risk rating)
Link to strategic priorities
2 4 £
Risk 3 Commentary
Construction Supply Chain Following a sustained period of materials cost inflation and constrained
capacity across the construction sector, the cost of materials had stabilised
with pricing further benefiting from increased competition between
contractors. However, conflict in the Middle East has caused a marked
increase in oil and gas prices, and constrained shipping in that region, at
least in the short-term, which will likely manifest in higher fuel prices and
could cause wider supply chain disruption both in terms of pricing and
availability. That being so, there is a reasonable prospect that the profile
of this Principal Risk will trend higher over coming months, and we continue
to monitor the risk closely.
Description Mitigation Risk profile
Exposure to construction supply chain may lead to increased pricing pressures, · Policy and Governance - A new Supply Chain Management and Current residual risk rating
labour constraints, and risk of disputes, default and/or insolvency of supply Procurement Policy, has recently been launched which will improve the rigour
chain partners. and consistency of supplier onboarding, relationship management and project MEDIUM (unchanged from prior year)
procurement. For example, the Policy:
· prescribes that Onboarding of new construction contractors and
consultants must be approved by Senior Management.
· imposes processes and controls for the procurement of construction
projects. Procurement of all construction related contracts and appointments
must be approved by Senior Management.
· mandates that all construction contractors and consultants must
undergo a detailed annual performance and relationship review.
· increases the regularity with which financial due diligence is
undertaken on construction contractors.
· Contract Management - contract precedents are prescribed for
construction contracts and consultancy appointments.
Risk appetite
BALANCED
Target residual risk
MEDIUM (aligned to current risk rating)
Link to strategic priorities
1 2 £
Risk 4 Commentary
Physical Climate Events UK weather patterns are increasingly volatile. Real estate development and
investment are vulnerable to extreme weather events, particularly rainfall,
whether short-term or prolonged. The former typically gives rise to a risk of
flood damage to property and/or buildings. The latter can hinder and/or delay
land remediation and infrastructure development works, resulting in higher
costs or deferred returns.
Description Mitigation Risk profile
Extreme weather events and long-term climate shifts (e.g. storms, floods, · As part of the planning application process for all new Current residual risk rating
wildfires, temperature extremes) disrupt construction supply chains, impact developments, a comprehensive suite of environmental assessments is undertaken
development operations, increase costs, and damage assets. to identify and mitigate site-specific risks. This includes a formal MEDIUM (NEW Principal Risk)
Environmental Impact Assessment (EIA) and flood mapping analysis.
· Detailed plans are maintained for all existing development and
investment assets within our portfolio, capturing key environmental and
infrastructure data including flood risk exposure. These plans are reviewed
annually and updated following material events or changes in site conditions.
· Comprehensive construction scheduling as part of the procurement
and project planning process, development schedules are collaboratively
developed with the Principal Contractor to incorporate seasonal and
weather-related considerations. This ensures that construction activities are
timed to minimise disruption from adverse weather conditions. Scheduling
updated as needed in response to forecasted climate events.
Risk appetite
BALANCED
Target residual risk
MEDIUM (aligned to current risk rating)
Link to strategic priorities
2 £ H
Risk 5 Commentary
Real Estate End Markets The residential land market remains subdued by both sell-side and demand-side
headwinds, which continue to offset positive momentum in the I&L sector,
resulting in lower overall returns at a portfolio level. The lack of
demand-side stimulus suggests that recovery is likely to be muted and/or slow,
as sell-side reforms take time to materialise, economic growth stagnates and
interest rates remain higher for longer. Our decision to pivot towards the
I&L sector over the medium term helps to mitigate the impact of these
prevailing residential market conditions.
The acute volatility of the current global backdrop, emanating from the Middle
East conflict, carries the potential to place downward pressure on markets in
a wide ranging manner: energy price shocks and supply chain turbulence could
adversely affect commercial occupier markets and lead to tenant financial
distress; persistent inflation could result in rising (or at least static)
interest rates and increasing borrowing costs for businesses and homeowners of
housing, and rising gilt rates, which result in a softening of real estate
yields. In light of this it is possible that the profile of this Principal
Risk will trend higher over coming months, and we continue to monitor the risk
closely.
Description Mitigation RISK PROFILE
Deterioration of end markets, driven by macroeconomic factors and investor · Portfolio Strategy which is re-assessed when required by the Current residual risk rating
sentiment, impacting valuations, financial returns and recycling of capital. Executive and reviewed bi-annually by the Board.
MEDIUM (unchanged from prior year)
· Investment Portfolio Strategy in place, which is re-assessed when
required by the CIO and reviewed annually by the Board.
· Quarterly meetings to cover national and regional market
intelligence, which informs investment, divestment, and development
strategies. Reviews and approve the vertical development pipeline bi-annually.
· Continuous monitoring of sales performance against forecast via
Management Information reporting to the Development Board, Executive and
Board.
· Group portfolio strategy work helps manage portfolio risk to
ensure Harworth is not over exposed to a particular area of the markets/and or
development lifecycle.
Risk appetite
BALANCED
Target residual risk
MEDIUM (aligned to current risk rating)
Link to strategic priorities
1 2 3 £
Risk 6 Commentary
Capital The increase in pace and scale of development activity across more sites under
our strategy inevitably requires more capital. This will come from a surplus
of internally generated capital, supplemented by RCF and project specific
debt, as well as new third party equity and entry into "off balance sheet"
partnerships which share the requirement for capital deployment.
Competitively priced capital remains available in the form of development debt
and partnership capital, albeit the cost of capital is at risk of rising if
the Middle East conflict persists, causing higher inflation and interest
rates. The prospect of raising balance-sheet equity remains somewhat
challenging unless the Company's share price discount to NDV narrows, which
could be compounded if global volatility hastens "risk-off" sentiment amongst
investors. If the Middle East conflict persists, therefore, the profile of
this risk will trend higher.
Description Mitigation RISK PROFILE
Inability to source adequate capital to meet our strategic growth aspirations. · Group funding strategy, which identifies, at a high level, the Current residual risk rating
planned sources and composition of funding for the business, most recently
reviewed and approved by the Board in Q1 2026. MEDIUM (unchanged from prior year)
· Forecast capital requirement is calculated for each Scheme and a
Scheme funding strategy is developed which identifies the planned sources for
that capital, drawing on the Group funding strategy.
· Capital requirements and funding are monitored via monthly
Development Board meetings and by the Executive via bi-annual Scheme Gateway
Reviews. Identifying capital requirements for each Scheme to inform
formulation of the annual Budget and Strategic Plan.
·
Risk appetite
CAUTIOUS
Target residual risk
LOW (below current risk rating)
Additional measures planned for 2026 to reduce risk in line with target:
We have identified the Projects for which partnership funding is our preferred
source of capital and are initiating engagement with prospective funding
partners.
Link to strategic priorities
1 2 3 4 £
Risk 7 Commentary
People As the size and shape of the workforce continues to adapt to the evolution of
our strategy, the Board recognises the importance of, and continues to monitor
closely, talent management, succession planning and, where appropriate,
structured organisational change management. This approach encompasses culture
and values, organisational design, recognition and reward, talent development
and succession planning.
Description Mitigation RISK PROFILE
Inadequate employee value proposition impacting the ability to attract, · Comprehensive Pay and Benefits Package which is regularly Current residual risk rating
retain, and develop quality talent, while also impacting succession planning benchmarked.
efforts.
MEDIUM (unchanged from prior year)
· Career Development Opportunities including training programs and
support for CPD/further education, our investment per capita to date has been
above sector norm.
· We promote a healthy work-life balance by offering flexible working
hours, hybrid work options, and support for employee wellbeing and mental
health.
· Measurement and Benchmarking - We have developed a series of
metrics to benchmark ourselves externally including the Employee Net Promoter
Score (+49) and Investors In People (Gold). The introduction of a new HRIS
will also enable more focussed tracking of employee trends and patterns
including performance against Objectives & Key Results (OKRs) and
wellbeing.
· Employee Engagement - Employee Forum takes place once a quarter
which is an opportunity for representative employees from each area of the
business to feedback / discuss concerns.
Risk appetite
CAUTIOUS
Target residual risk
LOW (below current risk rating)
Additional measures planned for 2026 to reduce risk in line with target:
In 2026, we intend to refine our Talent Management and Succession Planning
approach.
Link to strategic priorities
1 2 3 4 £ H
Risk 8 Commentary
Health and Safety We prioritise the health, safety and wellbeing of everyone involved in or
impacted by our activities, including site visitors and workers. Above all
else, we want everyone undertaking activity on our sites to be safe. This
commitment extends across all our sites and operations, from horizontal and
vertical development projects to our Investment Portfolio and our office
environments. The risks which we proactively manage can be organised into
three types: those which arise by virtue of our land and property ownership,
those which arise as a result of our development activity, albeit typically
via third-party contractors and consultants; and those which arise in our
office environments.
Description Mitigation RISK PROFILE
Serious injury / death to employees, subcontractors, visitors, and/or · Health and Safety Management System approved by Board and designed Current residual risk rating
occupiers resulting in operational impacts, liabilities, penalties and/or in line with recognised standards HSG65, ISO45001 and ISO14001 to ensure the
reputational damage. effectiveness of risk management. Supported by a cloud based digital incident LOW (unchanged from prior year)
reporting / investigation software.
· Assurance & Performance Monitoring which provides assurance
that the EHS management system is operating effectively. This comprises:
· site based inspection regime ("first line").
· quarterly site based and desktop compliance audits ("second line").
· performance monitoring through key channels such as the EHS Committee
(management committee).
· Mandatory EHS training provided to the business. Attendance at
these is linked through to bonus gateways to ensure participation.
Risk appetite
CAUTIOUS
Target residual risk
LOW (aligned to current risk rating)
Link to strategic priorities
£ H
Risk 9 Commentary
Liquidity Our investment in our land and development is funded from internal generation
of capital from sales alongside our debt funding facilities, such as the RCF.
We retain a high degree of control on spend, with budgets for the following
year shaped by cash generation in the preceding year.
Internal generation of capital from land and Investment Portfolio sales was a
more challenging exercise in the second half of 2025, principally due to
prevailing residential land market conditions which resulted in longer
deferred payment profiles on sales to house builders and a prolonged period
leading up to the Budget which deferred investment decisions by
counterparties. That said, we successfully completed another high volume of
land and asset sales towards the end of 2025, increased the RCF to £275m and
secured an infrastructure loan for enabling works to open up our Wingates
Scheme. This means that we retain headroom in working capital for business as
usual obligations and we continue to regard this risk as low.
Description Mitigation RISK PROFILE
Inability to maintain optimal levels of working capital to meet business as · Treasury policy is approved by Board and reviewed annually in line Current residual risk rating
usual obligations. with overall business needs, operational activities and maintenance of debt
facilities. LOW (NEW Principal Risk)
· Group funding strategy, which identifies, at a high level, the
planned sources and composition of funding for the business, was most recently
reviewed and approved by the Board in Q1 2026.
· Sales are tracked and cashflow forecasts are refreshed on a weekly
basis and monitored closely by the CFO and wider Executive team.
Risk appetite
CAUTIOUS
Target residual risk
LOW (aligned to current residual risk rating)
Link to strategic priorities
1 2 3 4 £
Risk 10 Commentary
Climate Transition and Reporting Transitioning to NZC poses a significant challenge to the business, driven by
the complexity of decarbonising large, long‑term brownfield regeneration
projects and the significant embodied carbon associated with remediation,
construction and infrastructure delivery. The business is highly dependent on
suppliers, contractors and future occupiers adopting low‑carbon approaches,
creating alignment and timing risks across the value chain. Increased
regulatory expectations and evolving corporate reporting standards have
potential to add compliance and cost pressures, in particular for our 2040 NZC
commitments and the associated 2030 NZC Commitment 3, specifically for
commercial development. Our NZC Pathway is an approach to mitigating these
risks, it sets out our corporate and development-based approach to NZC.
It has a wide-ranging impact on the Group, from our investment case to
shareholders through to operational activity, including the need to embed NZC
principles into all projects while remaining profitable. Our approach to
development continues to evolve to reflect external factors including industry
and stakeholder metrics, as well as the varied/emerging approaches taken by
Local and Combined Authorities to NZC, emissions targets and restrictions
through the planning process. The commitments within the NZC Pathway, combined
with the ongoing evolution of standards/regulation at a national, regional,
local and industry level, mean this risk remains an important area for the
business to understand and manage.
Description Mitigation RISK PROFILE
Failure to successfully transition to NZC, leading to non‑compliance with · The Harworth Way is the Group's formal framework for embedding Current residual risk rating
regulatory and reporting requirements, inability to meet the NZC targets we sustainability and social value principles into all aspects of the business
set ourselves, and associated reputational damage. and its developments. This control ensures that our NZC targets are integrated MEDIUM (unchanged from prior year)
into corporate culture, strategic planning, and the full development
lifecycle, from concept design through to completion. The framework is
reviewed annually by the Board to align with evolving regulatory requirements
and stakeholder expectations.
· Governance Structure: The Group maintains a formal governance
structure comprising the Board (oversight of sustainability risks,
opportunities, targets and performance) and Audit Committee (oversight of
regulatory and reporting requirements).
· ESG Reporting Assurance: year-on year enhancements to reporting
assurance, which readies us for implementation of the new ISSB reporting
regime.
Risk appetite
CAUTIOUS
Target residual risk
LOW (below current risk rating)
Additional measures planned for 2026 to reduce risk in line with target:
· We plan to establish a structured compliance management framework
to identify, assess, manage, and report on compliance obligations across all
business functions.
· Increased data capability via the Group's Digital Transformation
Project to help identify, assess, manage, and report on compliance obligations
across all business functions.
· Introduce a strategy for integration to business process as part
of our approach to align with the new ISSB reporting standards.
· Introduction of a Sustainability Committee (management committee)
as part of our formal governance structure, giving operational oversight of
ESG initiatives which implement the Harworth Way and contribute to meeting our
NZC targets and support reporting.
· Comprehensive review of the five NZC Commitments as part of the
evolution of the NZC Pathway.
· Increased levels of third party assurance to support compliance
with regulatory and reporting requirements.
Link to strategic priorities
1 £ H
Risk 11 Commentary
Digital Transformation Project (DTP) Like all organisations, Harworth operates in an environment defined by rapid
technological change, including the emergence and mounting prominence of
Artificial Intelligence. Whilst evolution of the technologies we use is and
will remain progressive, we recognise the need for a step-change in our
digital maturity and are addressing this via our Digital Transformation
Project. This carries a host of opportunities to drive operational
efficiencies and enhance decision-making.
Description Mitigation RISK PROFILE
Failure to implement a scalable and integrated digital architecture that · We have selected a strategic delivery partner which has extensive Current residual risk rating
enables operational efficiency, business growth, continuous innovation, and expertise in digital transformation, project / system delivery and software
effective AI adoption. development. MEDIUM (NEW Principal Risk)
· KPIs have been defined and are tracked / monitored on a monthly
basis.
· Project and Programme Governance is in place for the project which
includes regular meetings of Senior Management to ensure risks are effectively
managed and the project is on track to meet its objectives within budget and
timeframe.
· Business Engagement - regular communication to the Business with
training taking place at key points throughout the DTP lifecycle as well as
involvement of key user groups to ensure successful adoption of new systems.
Risk appetite
CAUTIOUS
Target residual risk
LOW (below current risk rating)
Additional measures planned for 2026 to reduce risk in line with target:
· DTP initiatives will continue to progress and mature in 2026,
delivering on key milestones within the roadmap.
· Technology Target Operating Model is being developed to ensure new
technology systems, services and process can be maintained and benefits
sustained once the Digital Transformation Project has been delivered.
Link to strategic priorities
£ H
Risk 12 Commentary
Digital Resilience Cyber threats pose an ever-evolving risk to all businesses. Those operating in
the real estate sector, which are often engaged in high-value transactions and
project-based activities and rely on valuable information relating to land,
property and projects, are particularly vulnerable to ransomware attacks,
intellectual property theft, business email compromise and invoice fraud. The
materialisation of any one of these threats, or self-harm via careless
handling of commercially sensitive information, could prejudice business
continuity and/or give rise to significant financial losses and/or serious
reputational harm. As Harworth's portfolio, activities and profile grow, so
will its vulnerability to cyber threats. It is also important that digital
resilience security keeps pace with the changes we are implementing as part of
our digital transformation project.
Description Mitigation RISK PROFILE
Failure to maintain digital resilience, resulting in compromised business · We have an Information Security Management System ('ISMS') that is Current residual risk rating
continuity, loss of intellectual property or data, ineffective cyber incident aligned with ISO 27001 and industry best practice.
response, and failure to support strategic enablement.
MEDIUM (unchanged from prior year)
· Revised data backup strategy implemented a ransomware resilient
backup plan to safeguard critical business data.
· We are utilising network monitoring and defence systems to detect
and prevent security threats.
· Systems deploying malware defence mechanisms to protect against
malicious software.
· Cyber risk insurance maintained to mitigate the financial impact of
potential security breaches.
· We conduct annual penetration testing, regular phishing
simulations, and continuous IT system vulnerability scanning to identify and
address weaknesses proactively.
· We have a robust (and recently updated) Cyber Incident Recovery
Plan to ensure operational resilience during a cyber-attack or system failure.
Risk appetite
CAUTIOUS
Target residual risk
LOW (below current risk rating)
Additional measures planned for 2026 to reduce risk in line with target:
· Publish revised policies to business, making clear standards and
processes expected to employees.
· Update and roll out new training platform to Harworth on cyber
security risks.
· Transition to a new Document Management Access and Storage system
which will support improved information classification and access controls.
· Deliver Cyber Simulation & Operational Exercise testing of Cyber
Incident Response Plan
Link to strategic priorities
£ H
Risk 13 Commentary
Government Policy Implementation Harworth, like its peers in the real estate sector, operates within a
regulatory and economic framework that is heavily influenced by government
policy. Political changes, whether through central Government or local
authority elections, leadership transitions, or shifts in political priorities
often carry uncertainty and/or delay, and some adversely impact our strategy
and/or business model and, therefore, the returns we can make for shareholders
and/or the positive outcome we can deliver for wider stakeholders.
Description Mitigation RISK PROFILE
Challenges in slow and/or inconsistent implementation of Government policy · Continuous horizon scanning is undertaken to identify and assess Current residual risk rating
across our regions alongside devolution and local government reform changing emerging policy risks and opportunities.
the landscape that we (investors and businesses) are operating in.
MEDIUM (NEW Principal Risk)
· Modelling - Where a policy is deemed to potentially have an impact
on Harworth (positive or negative) the Business will engage with the relevant
business stakeholders to undertake an impact assessment (supported by
financial modelling where it is reasonable to do so), scenario planning and
development of mitigation plans.
· A stakeholder engagement programme is in place that outlines
communication and engagement strategies for key stakeholders including local
and central government, community groups, trade bodies and investors.
· Site-specific engagement: where individual schemes are negatively
impacted by implementation of government policy (inconsistent or otherwise),
we develop comprehensive stakeholder plans and leverage key relationships to
unblock challenges and minimise the impact.
Risk appetite
BALANCED
Target residual risk
MEDIUM (aligned to current risk rating)
Link to strategic priorities
1 2 3 4 £
Strategic priorities
1 Repositioning our core Investment Portfolio to modern
Grade A
2 Increasing direct development of Industrial &
Logistics space.
3 Accelerating sales and broadening the range of our
Residential products.
4 Scaling up through land acquisitions and promotion
activities
£ Group targets
H The Harworth Way
Risk Appetite:
Averse We avoid risk and uncertainty.
Avoidance of risk and uncertainty is the overriding objective, and activities
should only be undertaken when they carry no or very low inherent risk.
Cautious We prefer options which carry low risk.
Preference for activities and delivery options which carry a low degree of
inherent risk or are deemed to carry a low degree of residual risk after
mitigation.
Balanced We are willing to consider a range of options and tolerate a degree of risk.
Willing to undertake activities and consider delivery options which carry a
medium degree of residual risk. This may mean that activities carry a high
degree of inherent risk but are deemed to carry medium residual risk after
mitigation.
Open We are focused on maximizing opportunities and returns.
Prepared to undertake activities and consider delivery options which carry (or
may carry) a medium to high residual risk, with the objective of maximising
opportunities and returns. Typically, such activities will be core to
Harworth's business model and corresponding risk/reward profile.
Directors' Responsibilities statement
The Directors' Responsibilities Statement below has been prepared in
connection with the full Annual Report and Financial Statements for the year
ended 31 December 2025.
The directors are responsible for preparing the Annual Report and the
Financial Statements in accordance with applicable United Kingdom law and
regulations.
Company law requires the Directors to prepare financial statements for each
financial year. Under that law the Directors have elected to prepare the Group
and Company Financial Statements in accordance with UK-adopted international
accounting standards (IFRSs). Under company law the Directors must not approve
the Financial Statements unless they are satisfied that they give a true and
fair view of the state of affairs of the Group and the Company and of the
profit or loss of the Group and the Company for that period.
In preparing these Financial Statements the Directors are required to:
· select suitable accounting policies in accordance with IAS 8
Accounting Policies, Changes in Accounting Estimates and Errors and then apply
them consistently;
· make judgements and accounting estimates that are reasonable and
prudent;
· present information, including accounting policies, in a manner
that provides relevant, reliable, comparable and understandable information;
· provide additional disclosures when compliance with the specific
requirements in IFRSs is insufficient to enable users to understand the impact
of particular transactions, other events and conditions on the Group and
Company financial position and financial performance;
· in respect of the Group Financial Statements, state whether
UK-adopted international accounting standards have been followed, subject to
any material departures disclosed and explained in the financial statements;
· in respect of the Company Financial Statements, state whether
UK-adopted international accounting standards have been followed, subject to
any material departures disclosed and explained in the Financial Statements;
and
· prepare the Financial Statements on the going concern basis unless it
is inappropriate to presume that the Company and/or the Group will continue in
business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company's and Group's transactions and
disclose with reasonable accuracy at any time the financial position of the
Company and the Group and enable them to ensure that the Company and the Group
Financial Statements comply with the Companies Act 2006. They are also
responsible for safeguarding the assets of the Group and Company and hence for
taking reasonable steps for the prevention and detection of fraud and other
irregularities.
Under applicable law and regulations, the Directors are also responsible for
preparing a strategic report, directors' report, directors' remuneration
report and corporate governance statement that comply with that law and those
regulations. The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the Company's website.
Responsibility statements
The Directors (see the list of names and roles in the Annual Report) confirm,
to the best of their knowledge:
· that the consolidated Financial Statements, prepared in accordance with
UK-adopted international accounting standards give a true and fair view of the
assets, liabilities, financial position and profit of the Company and
undertakings included in the consolidation taken as a whole;
· that the Annual Report, including the strategic report, includes a
fair review of the development and performance of the business and the
position of the Company and undertakings included in the consolidation taken
as a whole, together with a description of the principal risks and
uncertainties that they face; and
· that they consider the Annual Report, taken as a whole, is fair,
balanced and understandable and provides the information necessary for
shareholders to assess the Company's position, performance, business model and
strategy.
Disclosure of information to the auditor
Each of the Directors who were in office at the date of approval of this
Report also confirms that:
· so far as they are aware, there is no relevant audit information of
which the auditor is unaware; and
· each Director has taken all the steps that they ought to have taken
as a Director to make themselves aware of any relevant information and to
establish that the Group's and Company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the
provisions of section 418 Companies Act.
This Statement of Directors' Responsibilities was approved by the Board and
signed by order of the Board:
Chris Birch
General Counsel and Company Secretary
16 March 2026
Cautionary statement
This announcement and the 2025 Annual Report and Financial Statements contain
certain forward-looking statements which, by their nature, involve risk,
uncertainties and assumptions because they relate to future events and
circumstances. Actual outcomes and results may differ materially from any
outcomes or results expressed or implied by such forward looking statements.
Any forward-looking statements made by or on behalf of the Group are made in
good faith based on current expectations and beliefs and on the information
available at the time the statement is made. No representation or warranty is
given in relation to these forward-looking statements, including as to their
completeness or accuracy or the basis on which they were prepared, and undue
reliance should not be placed on them. The Group does not undertake to revise
or update any forward-looking statement contained in this announcement or the
2025 Annual Report and Financial Statements to reflect any changes in its
expectations with regard thereto or any new information or changes in events,
conditions or circumstances on which any such statement is based, save as
required by law and regulations. Nothing in this announcement or the 2025
Annual Report and Financial Statements should be construed as a profit
forecast.
Directors' liability
This announcement and the 2025 Annual Report and Financial Statements have
been prepared for, and only for, the shareholders of the Company, as a body,
and no other persons. Neither the Company nor the Directors accept or assume
any liability to any person to whom this announcement or the 2025 Annual
Report and Financial Statements is shown or into whose hands they may come
except to the extent that such liability arises and may not be excluded under
English law.
Shareholder information
Financial calendar
Results for the year ended 31 December 2025 Published 17 March 2026
Annual report and financial statements for the year ended 31 December 2025 Scheduled April 2026
2026 Annual General Meeting Scheduled 18 May 2026
Final dividend for the year ended 31 December 2025 Ex-dividend date 23 April 2026
Record date 24 April 2026
Payable 22 May 2026
Half year results for the six months ending 30 June 2026 Scheduled September 2026
Registrars
All administrative enquiries relating to shareholdings should, in the first
instance, be directed to Equiniti. Help can be found at www.shareview.co.uk.
Alternatively, you can contact Equiniti at Aspect House, Spencer Road,
Lancing, West Sussex, BN99 6DA (telephone: +44 (0)371 384 2301). You should
state clearly the registered shareholder's name and address.
Dividend mandate
Any shareholder wishing dividends to be paid directly into a bank or building
society should instruct this via the Shareview service or contact the
Registrars for a dividend mandate form. Dividends paid in this way will be
paid through the Bankers' Automated Clearing System ('BACS').
Shareview service
The Shareview service from Equiniti allows shareholders to manage their
shareholding online. It gives shareholders direct access to their data held on
the share register, including recent share movements and dividend details and
the ability to change their address or dividend payment instructions online.
To visit the Shareview website, go to www.shareview.co.uk. There is no charge
to register but the 'shareholder reference number' printed on proxy forms or
dividend stationery will be required.
Website
The Group's website (harworthgroup.com (http://harworthgroup.com/) ) provides
further information. Detailed information for shareholders can be found at
harworthgroup.com/investors.
Consolidated income statement
Year ended Year ended
31 December
31 December
Note
2025
2024
£'000
£'000
Revenue 3 129,749 181,585
Cost of sales 3 (117,197) (150,508)
Gross profit 3 12,552 31,077
Administrative expenses 3 (36,342) (33,185)
Other gains 3 45,543 78,113
Other operating expenses 3 (121) (1,371)
Operating profit 3 21,632 74,634
Finance costs 4 (15,203) (9,900)
Finance income 4 4,573 3,166
Share of profit of joint ventures (including impairment) 9 6,366 1,487
Profit before tax 17,368 69,387
Tax charge 5 (7,896) (12,150)
Profit for the year 9,472 57,237
Earnings per share from operations pence pence
Basic 7 2.9 17.7
Diluted 7 2.8 17.3
Notes 1 to 16 are an integral part of these condensed consolidated financial
statements.
All activities are derived from continuing operations.
Consolidated statement of comprehensive income
Year ended Year ended
31 December
31 December
2025
2024
£'000
£'000
Profit for the year 9,472 57,237
Other comprehensive (expense)/income - items that will not be reclassified to
profit or loss:
Net actuarial gain/(loss) in Blenkinsopp Pension scheme 29 (239)
Revaluation of Group occupied property - (515)
Deferred tax credit on other comprehensive income items 93 -
Total other comprehensive income/(expense) 122 (754)
Total comprehensive income for the year 9,594 56,483
Consolidated balance sheet
ASSETS As at As at
31 December
31 December
Note
2025 2024
£'000
£'000
Non-current assets
Intangible fixed assets 450 -
Property, plant and equipment 8,106 1,529
Right-of-use assets 1,200 1,443
Trade and other receivables 5,009 25,638
Investment properties 8 667,025 585,489
Investments in joint ventures 9 25,225 33,553
Retirement benefit asset 81 -
707,096 647,652
Current assets
Inventories 10 212,065 205,985
Trade and other receivables 85,493 72,580
Assets held for sale 11 7,686 8,910
Cash 12 27,144 117,382
Current tax asset 2,759 -
335,147 404,857
Total assets 1,042,243 1,052,509
LIABILITIES
Current liabilities
Trade and other payables (120,220) (135,998)
Lease liabilities (263) (271)
Current tax liabilities - (8,130)
(120,483) (144,399)
Net current assets 214,664 260,458
Non-current liabilities
Borrowings 13 (173,025) (164,125)
Trade and other payables (3,907) (15,226)
Lease liabilities (934) (1,196)
Net deferred tax liabilities (44,915) (35,853)
Retirement benefit obligations - (45)
(222,781) (216,445)
Total liabilities (343,264) (360,844)
Net assets 698,979 691,665
SHAREHOLDERS' EQUITY
Called up share capital 14 32,587 32,495
Share premium account 25,224 25,157
Fair value reserve 254,257 216,704
Capital redemption reserve 257 257
Merger reserve 45,667 45,667
Investment in own shares (193) (138)
Retained earnings 331,708 314,286
Current year profit 9,472 57,237
Total shareholders' equity 698,979 691,665
Condensed consolidated statement of changes in shareholders' equity
Called up share capital £'000 Share Fair Capital redemption reserve Investment in own
premium account Merger reserve value £'000 shares Retained earnings Total
£'000 £'000 reserve £'000 £'000 equity
£'000 £'000
Balance at 1 January 2024 32,408 25,034 45,667 225,177 257 (99) 309,278 637,722
Profit for the financial year - - - - - - 57,237 57,237
Fair value gains - - - 63,334 - - (63,334) -
Transfer of unrealised gains on disposal of investment property - - - (71,292) - - 71,292 -
Other comprehensive (expense)/income:
Actuarial loss in Blenkinsopp pension scheme - - - - - - (239) (239)
Revaluation of Group occupied property - - - (515) - - - (515)
- - - (8,473) - - 64,956 56,483
Transactions with owners:
Purchase of own shares - - - - - (39) - (39)
Share-based payments - - - - - - 2,188 2,188
Dividends paid - - - - - - (4,899) (4,899)
Share issue 87 123 - - - - - 210
Balance at 31 December 2024 32,495 25,157 45,667 216,704 257 (138) 371,523 691,665
Profit for the year to 31 December 2025 - - - - - - 9,472 9,472
Fair value gains - - - 54,640 - - (54,640) -
Transfer of unrealised gains on disposal of investment property - - - (17,087) - - 17,087 -
Other comprehensive (expense)/income:
Actuarial gain in Blenkinsopp pension scheme - - - - - - 29 29
Deferred tax on other comprehensive (expense)/income items - - - - - - 93 93
- - - 37,553 - - (27,959) 9,594
Transactions with owners:
Purchase of own shares - - - - - (55) - (55)
Share-based payments - - - - - - 3,019 3,019
Dividends paid - - - - - - (5,403) (5,403)
Share issue 92 67 - - - - - 159
32,587 25,224 45,667 254,257 257 (193) 341,180 698,979
Consolidated statement of cash flows
Year ended Year ended
31 December 31 December
2025 2024
£'000 £'000
Cash flows from operating activities
Profit before tax for the year 17,368 69,387
Net finance costs 10,630 6,734
Other gains (45,543) (78,113)
Share of profit of joint ventures (including impairment) (6,437) (1,487)
Share-based transactions((1)) 3,296 2,287
Depreciation of property, plant and equipment and right-of-use assets 608 406
Pension contributions in excess of charge (97) (205)
Operating cash outflows before movements in working capital (20,175) (991)
Decrease in inventories 3,513 57,088
Decrease/(increase) in receivables 11,817 (52,774)
(Decrease)/increase in payables (25,519) 39,297
Cash (used in)/generated from operations (30,364) 42,620
Interest paid (11,989) (7,568)
Corporation tax paid (9,693) (516)
Cash (used in)/ generated from operating activities (52,046) 34,536
Cash flows from investing activities
Interest received 342 810
Investment in joint ventures (1,933) (3,048)
Distribution from joint ventures 619 1,704
Net proceeds from disposal of investment properties, AHFS and overages 53,645 80,028
Property acquisitions (26,858) (69,478)
Expenditure on investment properties and AHFS (55,625) (47,009)
Expenditure on property, plant and equipment (10,052) (600)
Expenditure on intangible fixed assets (450) -
Cash used in investing activities (40,312) (37,593)
Cash flows from financing activities
Net proceeds from issue of ordinary shares 59 137
Proceeds from other loans - 5,510
Repayment of other loans - (37,134)
Proceeds from bank loans 492,000 205,000
Repayment of bank loans (482,000) (75,000)
Loan arrangement fees (2,202) (151)
Payment in respect of leases (334) (206)
Dividends paid (5,403) (4,899)
Cash generated from financing activities 2,120 93,257
(Decrease)/increase in cash (90,238) 90,200
Cash as at beginning of year 117,382 27,182
(Decrease)/increase in cash (90,238) 90,200
Cash as at end of year 27,144 117,382
( )
((1)) Share-based transactions reflect the non-cash expenses relating to
share-based payments included within the income statement
Notes to the financial information
for the year ended 31 December 2025
1. Material accounting policy information
The principal accounting policies adopted in the preparation of these
consolidated financial statements are set out below. These policies have been
consistently applied to all of the years presented, unless otherwise stated.
General information
Harworth Group plc (the "Company") is a company limited by shares,
incorporated and domiciled in the UK (England). The address of its registered
office is Advantage House, Poplar Way, Catcliffe, Rotherham, South Yorkshire,
S60 5TR.
The Company is a public company listed on the London Stock Exchange.
The consolidated financial statements for the year ended 31 December 2025
comprise the accounts of the Company and its subsidiaries (together referred
to as the "Group").
Basis of preparation
These financial statements have been prepared in accordance with international
accounting standards in conformity with the requirements of the Companies Act
2006 and UK-adopted International Accounting Standards ("IFRS").
The financial information set out herein does not constitute the Company's
statutory accounts for the years ended 31 December 2025 or 2024 but is derived
from those accounts. The financial information has been prepared using
accounting policies consistent with those set out in the annual report and
accounts for the year ended 31 December 2024. Statutory accounts for 2024 have
been delivered to the Registrar of Companies, and those for 2025 will be
delivered in due course. The auditors have reported on those accounts; their
report was unqualified, did not include a reference to any matters to which
the auditors drew attention by way of emphasis without qualifying their
report, and did not contain any statements under Section 498(2) or (3) of the
Companies Act 2006.
Going-concern basis
These financial statements are prepared on the basis that the Group is a going
concern. In forming its opinion as to going concern, the Company prepares cash
flow forecasts based upon assumptions, with particular consideration to key
risks and uncertainties and the macroeconomic environment as well as taking
into account available borrowing facilities, including compliance with
financial covenants therein. The going concern period assessed is until 30
June 2027 which is selected as it can be projected with a reasonable degree of
accuracy and covers a complete period of reporting under the Group's RCF.
A key focus of the assessment of going concern is the management of liquidity
and compliance with borrowing facilities for the period to 30 June 2027. A
£275.0m RCF facility is available to the group and is aligned to the Group's
strategy and provides significant liquidity and flexibility to enable it to
pursue its strategic objectives. The facility is subject to financial
covenants, including minimum interest cover, maximum infrastructure debt as a
percentage of property value and gearing, all of which are tested through the
going concern assessment undertaken. Available liquidity, including cash and
cash equivalents and bank facility headroom, was £127.1m as at 31 December
2025.
The Group benefits from diversification across its Capital Growth and Income
Generation businesses including its industrial and renewable energy property
portfolios. Taking into account the independent valuations carried out by JLL,
Savills and BNP Paribas as at 31 December 2025, the Group net
loan-to-portfolio value was 15.6%, within the Board's target range and with
sufficient headroom to allow for any falls in property values. Rent collection
remained strong, with 99.0% collected to date for 2025.
In addition to the Company's base cash flow forecast, sensitised forecasts
were produced that included severe but plausible downside scenarios. This
downside included: 1) a severe reduction in headline sales, including lower
investment property sales; 2) notwithstanding strong rent collection in 2025,
a prudent material increase in bad debts across the portfolio over the
majority of the going concern assessment period; 3) a material decline in the
value of land and investment property values, and 4) increases in interest
rates, impacting the cost of the Group's borrowings.
A scenario was also run which demonstrated that very severe loss of revenue,
valuation reductions and interest cost increases would be required to breach
banking covenants. The Directors consider this very severe scenario to be
remote. A scenario with consideration of potential climate change and related
transition impacts was also examined as part of the Group's focus on
climate-related risks and opportunities.
Under each of the plausible downside scenarios, for the going concern period
to 30 June 2027, the Group expects to continue to have sufficient liquidity to
continue to operate with headroom on lending facilities and associated
covenants and has, in addition, mitigation measures within management's
control, for example reducing development and acquisition expenditure and
reducing operating costs, that could be deployed to create further liquidity
and covenant headroom.
Based on these considerations, together with available market information and
the Directors' knowledge and experience of the Group's property portfolio and
markets, the Directors considered it appropriate to adopt a going concern
basis of accounting in the preparation of the Group's and Company's financial
statements.
Accounting policies
Changes in accounting policy and disclosures
(a) New standards, amendments and interpretations
A number of new standards and amendments to standards and interpretations are
effective for annual periods beginning on or after 1 January 2025. None of
these have had a significant effect on the financial statements of the
Group.
(b) New standards, amendments and interpretations not yet adopted
A number of new standards and amendments to standards and interpretations are
effective for annual periods beginning on or after 1 January 2026 and have not
been applied in preparing these financial statements. None of these are
expected to have a significant effect on the financial statements of the
Group.
Estimates and judgements
The preparation of the consolidated financial statements requires management
to make judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets and liabilities, income
and expense. Actual results may differ from these estimates.
In preparing these consolidated financial statements, the significant
judgements made by management in applying the Group's accounting policies and
the key sources of estimation uncertainty were the same as those that applied
in the consolidated financial statements for the year ended 31 December 2024.
2. Alternative Performance Measures ("APMs")
Introduction
The Group has applied the December 2019 European Securities and Markets
Authority ("ESMA") guidance on APMs and the November 2017 Financial Reporting
Council ("FRC") corporate thematic review of APMs in these results. An APM
is a financial measure of historical or future financial performance, position
or cash flows of the Group which is not a measure defined or specified under
IFRS.
Overview of use of APMs
The Directors believe that APMs assist in providing additional useful
information on the underlying trends, performance and position of the Group.
APMs assist stakeholder users of the accounts, particularly equity and debt
investors, through the comparability of information. APMs are used by the
Directors and management, both internally and externally, for performance
analysis, strategic planning, reporting and incentive-setting purposes.
APMs are not defined by IFRS and therefore may not be directly comparable with
other companies' APMs, including peers in the real estate industry. APMs
should be considered in addition to, and are not intended to be a substitute
for, or superior to, IFRS measurements.
The derivations of our APMs and their purpose
The primary differences between IFRS statutory amounts and the APMs that are
used by Harworth are as follows:
1. Capturing all sources of value creation - Under IFRS, the revaluation
movement in development properties which are held in inventory is not included
in the balance sheet. Also, overages are not recognised in the balance sheet
until they are highly probable. These movements, which are verified by our
independent valuers JLL, BNP Paribas and Savills, are included within our
APMs;
2. Re-categorising income statement amounts - Under IFRS, the grouping of
amounts, particularly within gross profit and other gains, does not clearly
allow Harworth to demonstrate the value creation through its business model.
In particular, the statutory grouping does not distinguish value gains
(being realised profits from the sales of properties and unrealised profits
from property value movements) from the ongoing profitability of the business
which is less susceptible to movements in the property cycle. Finally, the
Group includes profits from joint ventures within its APMs as its joint
ventures conduct similar operations to Harworth, albeit in different ownership
structures; and
3. Comparability with industry peers - Harworth discloses some APMs
which are EPRA measures as these are a set of standard disclosures for the
property industry and thus aid comparability for our stakeholder users.
Our key APMs
The key APMs that the Group uses are as follows:
· Total Accounting Return - The movement in EPRA NDV plus dividends per
share paid in the year expressed as a percentage of opening EPRA NDV per share
· Total Property Return - Calculated in line with the MSCI Property
Index Methodology
· EPRA NDV per share - EPRA NDV aims to represent shareholder value
under an orderly sale of the business, where deferred tax, financial
instruments and certain other adjustments are calculated to the full extent of
their liability net of any resulting tax. EPRA NDV per share is EPRA NDV
divided by the number of shares in issue at the end of the period, less shares
held by the Employee Benefit Trust or Equiniti Share Plan Trustees Limited to
satisfy Long Term Incentive Plan and Share Incentive Plan awards
· Value gains - These are the realised profits from the sales of
properties and unrealised profits from property value movements including
joint ventures and the mark to market movement on development properties, AHFS
and overages
· Net LTV - Group debt net of cash and cash equivalents held
expressed as a percentage of portfolio value
3. Segment information
Segmental Income Statement
Year ended 31 December 2025
Capital Growth
Sale of development properties Other property activities Income Central Total
Generation
£'000 £'000 £'000 £'000 £'000
Revenue ((1)) 56,928 47,835 24,986 - 129,749
Cost of sales (64,979) (46,772) (5,446) - (117,197)
Gross (loss)/profit ((2)) (8,051) 1,063 19,540 - 12,552
Administrative expenses ((3)) - (6,755) (2,148) (27,439) (36,342)
Other gains ((4)) - 41,492 7,964 (3,913) 45,543
Other operating expense - - - (121) (121)
Operating (loss)/profit (8,051) 35,800 25,356 (31,473) 21,632
Finance costs - - - (15,203) (15,203)
Finance income - 4,374 153 46 4,573
Share of profit of joint ventures - 3,615 2,751 - 6,366
(Loss)/profit before tax (8,051) 43,789 28,260 (46,630) 17,368
((1)) Revenue
Revenue is analysed as follows:
Sale of development properties 56,928 - - - 56,928
Revenue from PPAs - 4,741 - - 4,741
Build-to-suit development revenue - 41,989 - - 41,989
Rent, service charge and royalties revenue - 893 23,247 - 24,140
Other revenue - 212 1,739 - 1,951
56,928 47,835 24,986 - 129,749
((2)) Gross profit
Gross profit is analysed as follows:
Gross profit excluding sales of development properties - 1,063 19,540 - 20,603
Gross loss on sale of development properties* (3,152) - - - (3,152)
Net realisable value provision on development properties (13,915) - - - (13,915)
Reversal of previous net realisable value provision on development properties 8,163 - - - 8,163
Release of previous net realisable value provision on disposal of development 853 - - - 853
properties
(8,051) 1,063 19,540 - 12,552
*Gross profit on sale of development properties includes a reduction of £1.4m
(2024: £4.3m) relating to the discounting of deferred consideration
receivable.
((3)) Administrative expenses
Administrative expenses are analysed as follows:
Wages and salaries - (6,127) (1,027) (17,508) (24,662)
Legal and professional - 105 (629) (1,614) (2,138)
Other administrative expenses - (733) (492) (8,317) (9,542)
- (6,755) (2,148) (27,439) (36,342)
((4)) Other gains/(losses)
Other gains/(losses) are analysed as follows:
Increase in fair value of investment - 41,093 6,113 - 47,206
properties
Decrease in fair value of land and buildings - - - (3,913) (3,913)
Decrease in the fair value of AHFS - (14) (63) - (77)
(Loss)/profit on sale of investment properties - (257) 1,421 - 1,164
(Loss)/profit on sale of AHFS - (302) 493 - 191
Profit on sale of overages - 972 - - 972
- 41,492 7,964 (3,913) 45,543
Segmental Balance Sheet
As at 31 December 2025
Capital Income Central Total
£'000
Growth Generation £'000
£'000 £'000
Non-current assets
Intangible fixed assets - - 450 450
Property, plant and equipment - - 8,106 8,106
Right-of-use assets - - 1,200 1,200
Trade and other receivables 5,009 - - 5,009
Investment properties 359,614 307,411 - 667,025
Investments in joint ventures 8,475 16,750 - 25,225
Retirement benefit asset - - 81 81
373,098 324,161 9,837 707,096
Current assets
Inventories 211,799 266 - 212,065
Trade and other receivables 76,974 7,761 758 85,493
AHFS - 7,686 - 7,686
Cash and cash equivalents - - 27,144 27,144
Current tax asset - - 2,759 2,759
288,773 15,713 30,661 335,147
Total assets 661,871 339,874 40,498 1,042,243
Financial liabilities and derivative financial instruments are not allocated
to the reporting segments as they are managed and measured at a Group level.
Segmental Income Statement
Year ended 31 December 2024
Capital Growth
Sale of Development Properties Other Property Activities Income Central Total
Generation
£'000 £'000 £'000 £'000 £'000
Revenue ((1)) 140,253 19,841 21,491 - 181,585
Cost of sales (126,320) (19,534) (4,654) - (150,508)
Gross profit ((2)) 13,933 307 16,837 - 31,077
Administrative expenses ((3)) - (6,367) (1,107) (25,711) (33,185)
Other gains ((4)) - 59,722 18,391 - 78,113
Other operating expenses - - - (1,371) (1,371)
Operating profit/(loss) 13,933 53,662 34,121 (27,082) 74,634
Finance costs - (119) - (9,781) (9,900)
Finance income - 2,974 125 67 3,166
Share of (loss)/profit of joint ventures - (717) 2,204 - 1,487
Profit/(loss) before tax 13,933 55,800 36,450 (36,796) 69,387
((1)) Revenue
Revenue is analysed as follows:
Sale of development properties 140,253 - - - 140,253
Revenue from PPAs - 593 - - 593
Build-to-suit development revenue - 18,690 - - 18,690
Rent, service charge and royalties revenue - 412 21,358 - 21,770
Other revenue - 146 133 - 279
140,253 19,841 21,491 - 181,585
((2)) Gross profit
Gross profit is analysed as follows:
Gross profit excluding sales of development properties - 307 16,837 - 17,144
Gross profit on sale of development properties 8,248 - - - 8,248
Net realisable value provision on development properties (5,664) - - - (5,664)
Reversal of previous net realisable value provision on development properties 6,950 - - - 6,950
Release of net realisable value provision on disposal of development 4,399 - - - 4,399
properties
13,933 307 16,837 - 31,077
( )
((4)) Other gains/(losses)
Other gains/(losses) are analysed as follows:
Increase in fair value of investment - 43,004 17,813 - 60,817
properties
Decrease in the fair value of AHFS - (201) (165) - (366)
Profit on sale of investment properties - 12,476 826 - 13,302
Profit/(loss) on sale of AHFS - 97 (83) - 14
Profit on sale of overages - 4,346 - - 4,346
- 59,722 18,391 - 78,113
((3)) Administrative expenses
Administrative expenses are analysed as follows:
Wages and salaries - (5,255) (902) (16,398) (22,555)
Legal and professional - (531) (408) (3,683) (4,622)
Other administrative expenses - (581) 203 (5,630) (6,008)
- (6,367) (1,107) (25,711) (33,185)
Segmental Balance Sheet
As at 31 December 2024
Capital Income Central Total
£'000
Growth Generation £'000
£'000 £'000
Non-current assets
Property, plant and equipment - - 1,529 1,529
Right-of-use assets - - 1,443 1,443
Trade and other receivables 25,638 - - 25,638
Investment properties 281,635 303,854 - 585,489
Investments in joint ventures 18,935 14,618 - 33,553
326,208 318,472 2,972 647,652
Current assets
Inventories 205,985 - - 205,985
Trade and other receivables 61,404 10,948 228 72,580
AHFS 2,450 6,460 - 8,910
Cash and cash equivalents - - 117,382 117,382
269,839 17,408 117,610 404,857
Total assets 596,047 335,880 120,582 1,052,509
Financial liabilities and derivative financial instruments are not allocated
to the reporting segments as they are managed and measured at a Group level.
4. Finance costs and finance income
Year ended Year ended
31 December
31 December
2025
2024
£'000
£'000
Finance income
- Bank interest 342 810
- Unwind of discounting on deferred consideration 4,231 2,356
Total finance income 4,573 3,166
Finance costs
- Bank interest (11,345) (6,201)
- Facility fees (643) (1,235)
- Amortisation of up-front fees (1,102) (727)
- Other interest (2,113) (1,737)
Total finance costs (15,203) (9,900)
Net finance costs (10,630) (6,734)
5. Tax
Year ended Year ended
31 December
31 December
2025
2024
£'000
£'000
Analysis of tax charge in the year
Current tax
Current year - (7,931)
Adjustment in respect of prior periods 1,358 1,925
Total current tax credit/(charge) 1,358 (6,006)
Deferred tax
Current year (5,924) (5,807)
Adjustment in respect of prior periods (3,330) (337)
Total deferred tax charge (9,254) (6,144)
Tax charge (7,896) (12,150)
Other comprehensive income items
Deferred tax credit - current year 93 -
Total 93 -
The tax charge for the year is higher (2024: lower) than the standard rate of
corporation tax in the UK of 25% (2024: 25%). The differences are explained
below:
Year ended Year ended
31 December
31 December
2025
2024
£'000
£'000
Profit before tax 17,368 69,387
Profit before tax multiplied by rate of corporation tax in the UK of 25% (4,342) (17,347)
(2024: 25%)
Effects of:
Adjustments in respect of prior periods - deferred taxation (3,330) 337
Adjustments in respect of prior periods - current taxation 1,358 1,925
Defined benefits pension scheme - (342)
Non-taxable income - 107
Expenses not deducted for tax purposes (1,676) (327)
Revaluation (losses)/gains (1,272) 2,734
Share of profit of joint ventures - 372
Share options 39 94
Utilisation of unrecognised deferred tax assets 106 176
Losses not recognised previously 1,157 -
Other adjustments 64 121
Total tax charge (7,896) (12,150)
At 31 December 2025, the Group had a current tax asset of ££2.8m (2024:
current tax liability £8.1m).
The Company has recognised a current tax asset in 2025 of £0.4m (2024:
£0.4m).
Deferred tax
The following is the analysis of deferred tax liabilities presented in the
consolidated balance sheet:
As at As at
31 December
31 December
2025
2024
£'000
£'000
Deferred tax assets 10,182 1,520
Deferred tax liabilities (55,097) (37,373)
(44,915) (35,853)
The movements on the deferred income tax account were as follows:
Investment Tax Other Total
Properties
Losses
Temporary
£'000
£'000
£'000
Differences
£'000
At 1 January 2024 (30,592) - 503 (30,089)
Recognised in the consolidated income statement (6,781) - 637 (6,144)
Recognised in the consolidated statement of equity - - 380 380
At 31 December 2024 and 1 January 2025 (37,373) - 1,520 (35,853)
Recognised in the consolidated income statement (12,067) 5,690 (2,877) (9,254)
Recognised in the consolidated statement of comprehensive income -
- - -
Recognised in the consolidated statement of equity - - 192 192
At 31 December 2025 (49,440) 5,690 (1,165) (44,915)
Deferred tax assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets against current tax liabilities
and when the deferred taxes relate to the same fiscal authority.
Deferred tax assets of £4.4m at 31 December 2025 (2024: £5.4m) have not been
recognised owing to the uncertainty as to their recoverability.
The Company has recognised a deferred tax asset in 2025 of £0.9m (2024:
£0.6m).
6. Dividends
Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
Interim dividend of 0.538p per share for the year ended 31 December 2025 1,748 -
Full year dividend of 1.125p per share for the year ended 31 December 2024 3,655 -
Interim dividend of 0.489p per share for the year ended 31 December 2024 - 1,589
Full year dividend of 1.022p per share for the year ended 31 December 2023 - 3,310
5,403 4,899
The Board has declared a final dividend to be paid of 1.237p (2024: 1.125p)
per share to be paid in May 2026, bringing the total dividend for the year to
1.775p (2024: 1.614p). The recommended 2025 final dividend and 2025 total
dividend represent a 10% increase.
There is no change to the current dividend policy to continue to grow the
dividends by 10% each year.
7. Earnings per share
Earnings per share has been calculated by dividing the profit attributable to
ordinary shareholders by the weighted average number of shares in issue and
ranking for dividend during the year.
Year ended Year ended
31 December 31 December
2025 2024
Profit from continuing operations attributable to ordinary shareholders 9,472 57,237
(£'000)
Weighted average number of shares used for basic earnings per share 324,003,413 323,497,275
calculation
Basic earnings per share (pence) 2.9 17.7
Weighted average number of shares used for diluted earnings per share 334,337,040 331,274,223
calculation
Diluted earnings per share (pence) 2.8 17.3
The difference between the weighted average number of shares used for the
basic and diluted earnings per share calculation is due to the effect of
employee share schemes that are dilutive.
8. Investment properties
The Group holds five categories of investment property being Agricultural
Land, Natural Resources, the Investment Portfolio, Major Developments and
Strategic Land in the UK, which sit within the operating segments of Income
Generation and Capital Growth.
Income Generation Capital Growth
Agricultural Land Investment Major Strategic Land
£'000 Natural Portfolio Developments £'000 Total
£'000
Resources £'000 £'000
£'000
At 1 January 2024 6,510 19,901 208,315 58,340 140,876 433,942
Direct acquisitions - - 44,833 30,494 15,462 90,789
Subsequent expenditure 36 624 1,494 41,733 3,111 46,998
Disposals - - (648) - (40,022) (40,670)
(Decrease)/increase in fair value (278) 688 17,402 3,656 39,349 60,817
Transfers between divisions - (1,285) 11,149 (8,119) (1,745) -
Transfer to AHFS - (2,167) (2,720) - (1,500) (6,387)
At 31 December 2024 6,268 17,761 279,825 126,104 155,531 585,489
Direct acquisitions - 286 - 36,894 1,599 38,779
Subsequent expenditure 152 30 1,125 42,089 12,497 55,893
Disposals - (824) (26,880) - (310) (28,014)
Increase in fair value 451 238 5,424 10,470 30,623 47,206
Transfers between divisions - 2,445 42,050 (42,050) (2,445) -
Transfers from/(to) development properties - - 155 (10,535) - (10,380)
Transfer to AHFS - - (21,098) - (850) (21,948)
At 31 December 2025 6,871 19,936 280,601 162,972 196,645 667,025
Subsequent expenditure is recorded net of government grants of £0.7m (2024:
£nil).
During the year £0.2m (2024: £nil) development property was re-categorised
as investment property to reflect a change in use. During the year £10.5m
(2024: £nil) of the investment property was re-categorised to development
properties. During the year no investment property was re-categorised as land
and buildings (2024: £nil).
Investment property is transferred between divisions to reflect a change in
the activity relating to the asset.
Valuation process
The properties were valued in accordance with the Royal Institution of
Chartered Surveyors (RICS) Valuation - Professional Standards (the 'Red Book')
by BNP Paribas Real Estate, Jones Lang LaSalle and Savills at 31 December
2025. All three are independent firms acting in the capacity of external
valuers with relevant experience of valuations of this nature.
The valuations are on the basis of Market Value as defined by the Red Book,
which RICS considers meets the criteria for assessing Fair Value under IFRS.
The valuations are based on what is determined to be the highest and best use.
When considering the highest and best use a valuer will consider, on a
property by property basis, its actual and potential uses which are
physically, legally and financially viable. Where the highest and best use
differs from the existing use, the valuer will consider the cost and the
likelihood of achieving and implementing this change in arriving at its
valuation.
At each financial year end, management:
· verifies all major inputs to the independent valuation report;
· assesses property valuation movements when compared to the prior
year valuation report; and
· holds discussions with the independent valuers.
The Directors determine the applicable hierarchy that each investment property
falls into by assessing the level of unobservable inputs used in the valuation
technique. As a result of the specific nature of each investment property,
valuation inputs are not based on directly observable market data and
therefore all investment properties were determined to fall into Level 3.
The Group's policy is to recognise transfers into and out of fair value
hierarchy levels as at the date of the event or change in circumstance that
caused the transfer. There were no transfers between hierarchy levels in the
year ended 31 December 2025 (2024: none).
Valuation techniques underlying management's estimation of fair value are as
follows:
Agricultural land
Most of the agricultural land is valued using the market comparison basis,
with an adjustment made for the length of the remaining term on any tenancy
and the estimated cost to bring the land to its highest and best use. Where
the asset is subject to a secure letting, it is valued on a yield basis, based
upon sales of similar types of investment.
Natural resources
Natural resource sites in the portfolio are valued based on discounted cash
flow for the operating life of the asset with regard to the residual land
value.
Investment Portfolio
The Industrial & Logistics investment properties are valued on the basis
of market comparison with direct reference to observable market evidence
including current rent and estimated rental value (ERV), yields and capital
values and adjusted where required for the estimated cost to bring the
property to its highest and best use. The evidence is adjusted to reflect the
quality of the property assets, the quality of the covenant profile of the
tenants and the reliability/volatility of cash flows. The Group's portfolio
has a spread of yields. In the past, income acquisitions have been made at
high yields where value can be added. As assets are enhanced and improved,
these would also be expected to be valued at lower yields. Subject to market
backdrop, properties that are built by Harworth will be modern Grade A with
typically lower yields.
Major Developments
Major Development sites are generally valued using residual development
appraisals, a form of discounted cash flow which estimates the current site
value from future cash flows measured by current land and/or completed built
development values, observable or estimated development costs, and observable
or estimated development returns. Where possible development sites are valued
by direct comparison to observable market evidence with appropriate adjustment
for the quality and location of the property asset, although this is generally
only a reliable method of measurement for smaller development sites.
Strategic Land
Strategic Land is valued on the basis of discounted cash flow, with future
cash flows measured by current land values adjusted to reflect the quality of
the development opportunity, the potential development costs estimated by
reference to observable development costs on comparable sites, and the
likelihood of securing planning consent. The valuations are then benchmarked
against observable land values reflecting the current existing use of the
land, which is generally agricultural and, where available, observable
strategic land values. The discounted cash flows across the different property
categories utilise value per acre, which takes account of the future
expectations of sales over time discounted back to a current value, and cost
report totals, which take account of the cost, as at today's value, to
complete remediation and provide the necessary site infrastructure to bring
the site forward.
9. Investment in joint ventures
As at As at
31 December 31 December 2024
2025 £'000
£'000
At 1 January 33,553 30,722
Investment in joint ventures 1,933 3,048
Distributions from joint ventures (619) (1,704)
Share of profits of joint ventures 6,437 1,487
Derecognition of carrying value on acquisition of joint venture (12,079) -
Share of fair value uplift of joint venture prior to derecognition (4,000) -
At 31 December 25,225 33,553
10. Inventories
As at As at
31 December 31 December 2024
2025 £'000
£'000
Development properties 195,185 190,888
Planning promotion agreements 3,768 4,655
Option agreements 12,846 10,442
Biodiversity Net Gain (BNG) units 266 -
Total inventories 212,065 205,985
The movement in development properties is as follows:
Year ended Year ended
31 December 31 December 2024
£'000
2025
£'000
At 1 January 190,888 250,024
Acquisitions 1,256 1,419
Subsequent expenditure 37,503 38,919
Disposals (39,156) (105,159)
Net realisable value provision (charge)/release (4,899) 5,685
Net transfer to land and buildings (787) -
Net transfer from investment properties 10,380 -
Total development properties 195,185 190,888
The movement in net realisable value provision was as follows:
Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
At 1 January 8,451 14,136
Charge for the year 13,915 5,664
Reversal of previous net realisable value provision (8,163) (6,950)
Released on disposals (853) (4,399)
At 31 December 13,350 8,451
11. Assets held for sale
AHFS relate to investment properties identified as being for sale within 12
months, where a sale is considered highly probable and the property is
immediately available for sale.
As at As at
31 December 31 December 2024
£'000
2025
£'000
At 1 January 8,910 18,752
Net transfer from investment properties 21,948 6,387
Subsequent expenditure (268) 163
Decrease in fair value (77) (366)
Disposals (22,827) (16,026)
At 31 December 7,686 8,910
12. Cash
As at As at
31 December 31 December 2024
£'000
2025
£'000
Cash 27,144 117,382
13. Borrowings
As at As at
31 December 31 December
2025 2024
£'000
£'000
Non-current:
Secured - bank loan (173,025) (164,125)
Total non-current borrowings (173,025) (164,125)
Total borrowings (173,025) (164,125)
Loans are stated after deduction of unamortised fees of £2.0m (2024: £0.9m).
At the beginning of 2025, the Group had in place a £240 million Revolving
Credit Facility ('Old RCF') which was due to expire in 2027. During the year
the Group refinanced and entered into a new £275 million Revolving Credit
Facility ('New RCF') having repaid the Old RCF in full. The New RCF is
provided by NatWest, Santander and HSBC and covers an initial four-year term,
which may be extended to five years at Harworth's request, and is repayable on
a non-amortising basis. The New RCF includes an uncommitted accordion option
which if exercised would increase the New RCF to £325 million.
The New RCF is subject to financial and other covenants. Borrowings are
secured by way of a floating debenture over assets not otherwise used as
security under specific infrastructure or direct development loans. Proceeds
from and repayments of bank loans are reflected gross in the Consolidated
Statement of Cash Flows and reflect timing of utilisation of the RCF.
Following the balance sheet date the Group entered into a 3-year premium paid
interest rate cap covering a notional amount of £50 million at a strike rate
of 4.5%
Infrastructure and direct development loans (£nil at 31 December 2025 and 31
December 2024) are provided by public and private bodies in order to promote
the development of major sites or assist with vertical direct development. The
loans are drawn down as work on the respective sites is progressed and repaid
on agreed dates or when disposals are made from the sites. At the year end the
Group had an undrawn development loan provided by the North West Evergreen
Fund, this will provide up to £26.2m in debt funding in support of
development at our Wingates Major Development I&L site.
14. Share capital
As at As at
31 December 31 December
Issued, authorised and fully paid 2025 2024
£'000
£'000
At 1 January 32,495 32,408
Shares issued 92 87
At 31 December 32,587 32,495
As at As at
31 December 31 December
Issued, authorised and fully paid - number of shares 2025 2024
At 1 January 324,955,414 324,084,072
Shares issued 917,878 871,342
At 31 December 325,873,292 324,955,414
Own shares held (1,732,232) (1,314,562)
At 31 December 324,141,060 323,640,852
15. Related party transactions
The Group carried out the following transactions with related parties. The
following entities are related parties as a consequence of shareholdings,
joint venture arrangements and partners of such and/or common Directorships.
All related party transactions are clearly justified and beneficial to the
Group, are undertaken on an arm's-length basis on fully commercial terms and
in the normal course of business.
Year ended/ Year ended/
As at As at
31 December 31 December
2025 2024
£000 £000
MULTIPLY LOGISTICS NORTH HOLDINGS LIMITED &
MULTIPLY LOGISTICS NORTH LP
Sales
Recharges of costs 150 176
Asset management fee 86 107
Water charges 119 132
Purchases
Recharge of costs - 3
Receivables
Trade receivables - 39
Payables
Other payables (66) (66)
CRIMEA LAND MANSFIELD LLP
Investment made during the year 150 25
NORTHERN GATEWAY DEVELOPMENT VEHICLE LLP
Sales 11 -
Recharge of costs
Purchases
Recharge of costs - 5
Investment made during the year 1,783 3,023
INVESTMENT PROPERTY FORUM
Purchases - 3
BRITISH PROPERTY FEDERATION
Purchases 19 20
16. Post balance sheet events
There are no post balance sheet events to disclose that have not been
disclosed publicly by a regulatory news announcement.
Appendix
EPRA Net Asset Measures
EPRA introduced a new set of Net Asset Value metrics in 2020: EPRA Net
Reinstatement Value ("NRV"), EPRA Net Tangible Assets ("NTA") and EPRA NDV.
While the Group uses only EPRA NDV as a key APM, the EPRA Best Practices
Recommendations guidelines require companies to report all three EPRA NAV
metrics and reconcile them to IFRS. These disclosures are provided below.
31 December 2025
EPRA NDV EPRA NTA EPRA NRV
£'000 £'000 £'000
Net assets 698,979 698,979 698,979
Cumulative unrealised gains on development properties 32,330 32,330 32,330
Cumulative unrealised gains on overages 5,454 5,454 5,454
Deferred tax liabilities (IFRS) - 44,915 44,915
Notional deferred tax on unrealised gains (9,446) - -
Deferred tax liabilities @ 50% - (27,181) -
Purchaser costs - - 64,084
727,317 754,497 845,762
Number of shares used for per share calculations 324,141,060 324,141,060 324,141,060
Per share (p) 224.4 232.8 260.9
31 December 2024
EPRA NDV EPRA NTA EPRA NRV
£'000 £'000 £'000
Net assets 691,665 691,665 691,665
Cumulative unrealised gains on development properties 31,026 31,026 31,026
Cumulative unrealised gains on overages 6,100 6,100 6,100
Deferred tax liabilities (IFRS) - 35,853 35,853
Notional deferred tax on unrealised gains (9,253) - -
Deferred tax liabilities @ 50% - (22,553) -
Purchaser costs - - 58,616
719,538 739,209 817,598
Number of shares used for per share calculations 323,640,852 323,640,852 323,640,852
Per share (p) 222.3 229.3 254.4
1) Reconciliation to statutory measures
a. Revaluation gains Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
Increase in fair value of investment properties 47,206 60,817
Decrease in fair value of land and buildings (3,913) -
Decrease in fair value of AHFS (77) (366)
Share of profit of joint ventures 6,366 1,487
Net realisable value provision on development properties (13,915) (5,664)
Reversal of previous net realisable value provision on development properties 8,163 6,950
Amounts derived from statutory reporting 43,830 63,224
Unrealised gains on development properties 9,381 21,874
Unrealised gains on overages 354 854
Revaluation gains 53,565 85,952
b. Profit/(loss) on sale Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
Profit on sale of investment properties 1,164 13,302
Profit on sale of AHFS 191 14
(Loss)/profit on sale of development properties (3,152) 8,249
Release of net realisable value provision on disposal of development 853 4,399
properties
Profit on sale of overages 972 4,346
Amounts derived from statutory reporting 28 30,310
Less previously unrealised gains on development properties released on sale (8,076) (14,932)
Less previously unrealised gains on overages released on sale (1,000) (4,154)
(Loss)/profit on sale contributing to growth in EPRA NDV (9,048) 11,224
c. Value gains Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
Revaluation gains 53,565 85,952
(Loss)/profit on sale (9,048) 11,224
Value gains 44,517 97,176
d. Total property sales Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
Revenue 129,749 181,585
Less revenue from other property activities (47,835) (19,841)
Less revenue from income generation activities (24,986) (21,491)
Add proceeds from sales of investment properties, AHFS and overages 58,069 75,541
Total property sales 114,997 215,794
e. Operating profit contributing to growth in EPRA NDV Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
Operating profit 21,632 74,634
Share of profit of joint ventures 6,366 1,487
Unrealised gains on development properties 9,381 21,874
Unrealised gains on overages 354 854
Less previously unrealised gains on development properties released on sale (8,076) (14,932)
Less previously unrealised gains on overages released on sale (1,000) (4,154)
Operating profit contributing to growth in EPRA NDV 28,657 79,763
As at As at
f. Portfolio value 31 December 31 December
2025 2024
£'000
£'000
Land and buildings (included within property, plant and equipment) 4,155 1,188
Investment properties 667,025 585,489
Investments in joint ventures 25,225 33,553
AHFS 7,686 8,910
Development properties (included within inventories) 195,186 190,888
Amounts recoverable on contracts (included within receivables) 165 1,604
Amounts derived from statutory reporting 899,441 899,442 821,632
Cumulative unrealised gains on development properties as at year end 32,330 31,026
Cumulative unrealised gains on overages as at year end 5,454 5,454 6,100
Portfolio value 937,225 937,226 858,758
942,726
As at As at
g. Net debt 31 December 31 December
2025 2024
£'000
£'000
Gross borrowings (173,025) (164,125)
Cash 27,144 117,382
Net debt (145,881) (46,743)
As at As at
h. Net loan to portfolio value (%) 31 December 31 December
2025 2024
£'000
£'000
Net debt (145,881) (46,743)
Portfolio value 937,225 858,758
Net loan to portfolio value (%) 15.6% 5.4%
i. Net loan to core income generation portfolio value (%) As at As at
31 December 31 December
2025 2024
£'000
£'000
Net debt (145,881) (46,743)
Core income generation portfolio value (Investment Portfolio and Natural 300,537 297,587
Resources)
Net loan to core income generation portfolio value (%) 48.5% 15.7%
j. Gross loan to portfolio value (%)
As at As at
31 December 31 December
2025 2024
£'000
£'000
Gross borrowings (173,025) (164,125)
Portfolio value 937,225 858,758
Gross loan to portfolio value (%) 18.5% 19.1%
k. Gross loan to core income generation portfolio value (%)
As at As at
31 December 31 December
2025 2024
£'000
£'000
Gross borrowings (173,025) (164,125)
Core income generation portfolio value (Investment Portfolio and Natural 300,537 297,587
Resources)
Gross loan to core income generation portfolio value (%) 57.6% 55.2%
l. Number of shares used for per share calculations (number)
As at As at
31 December 31 December
2025 2024
Number of shares in issue at end of year 325,873,292 324,955,414
Less Employee Benefit Trust and Equiniti Share Plan Trustees Limited held (1,732,232) (1,314,562)
shares (own shares) at end of year
Number of shares used for per share calculations 324,141,060 323,640,852
m. Net Asset Value (NAV) per share
As at As at
31 December 31 December
2025 2024
NAV (£'000) 698,979 691,665
Number of shares used for per share calculations 324,141,060 323,640,852
NAV per share (p) 215.6 213.7
n. Total underlying revenue
Year ended Year ended
31 December 31 December
2025 2024
£'000
£'000
Total property sales 114,997 215,794
Income generation portfolio revenue (Investment Portfolio, Natural Resources 24,986 21,491
and Agriculture)
Build-to-suit development revenue 41,989 18,690
Other revenue 5,846 1,151
Total underlying revenue 187,818 257,126
Less proceeds from sale of investment properties, AHFS and overages (58,069) (75,541)
Statutory revenue 129,749 181,585
2) Reconciliation to EPRA measures
a) EPRA NDV As at
As at 31 December
31 December 2024
£'000
2025
£'000
Net assets 698,979 691,665
Cumulative unrealised gains on development properties 32,330 31,026
Cumulative unrealised gains on overages 5,454 6,100
Notional deferred tax on unrealised gains (9,446) (9,253)
EPRA NDV 727,317 719,538
b) EPRA NDV per share (p) As at As at
31 December 31 December
2025 2024
EPRA NDV £'000 727,317 719,538
Number of shares used for per share calculations 324,141,060 323,640,852
EPRA NDV per share (p) 224.4 222.3
c) EPRA NDV growth and total accounting return
Opening EPRA NDV/share (p) 222.3 205.1
Closing EPRA NDV/share (p) 224.4 222.3
Movement in the year (p) 2.1 17.2
EPRA NDV growth 0.9% 8.4%
Dividends paid per share (p) 1.7 1.5
Total accounting return per share (p) 3.8 18.7
Total accounting return as a percentage of opening EPRA NDV 1.7% 9.1%
To help retain and incentivise a management team with the requisite skills,
knowledge and experience to deliver strong, long-term, sustainable growth for
shareholders Harworth runs a number of share schemes for employees. The
dilutive impact of these on the number of shares at 31 December is set out
below:
As at As at
31 December
2025 31 December
2024
Number of shares used for per share calculations 324,141,060 323,640,852
Outstanding share options and shares held in trust under employee share 9,396,649 7,135,161
schemes
Number of diluted shares used for per share calculations 333,537,709 330,776,013
Diluted EPRA NDV per share, Diluted NDV Growth and Total Accounting Return as
a percentage of opening diluted EPRA NDV per share are set out below:
d. Diluted EPRA NDV per share (p) As at As at
31 December
2025 31 December
2024
EPRA NDV (£'000) 727,317 719,538
Number of diluted shares used for per share calculations 333,537,709 330,776,013
Diluted EPRA NDV per share (p) 218.1 217.5
Diluted EPRA NDV growth and total accounting return
Opening EPRA NDV/share (p) 217.5 201.9
Closing EPRA NDV/share (p) 218.1 217.5
Movement in the period/year (p) 0.6 15.6
Diluted EPRA NDV per share growth 0.3% 7.7%
Dividends paid per share (p) 1.7 1.5
Total return per share (p) 2.3 17.2
Total return as a percentage of opening diluted EPRA NDV 1.0% 8.5%
e) Net loan to EPRA NDV As at As at
31 December 2025 31 December 2024
£'000 £'000
Net debt (145,881) (46,743)
EPRA NDV 727,317 719,538
Net loan to EPRA NDV 20.1% 6.5%
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