REG - Boot(Henry) PLC - AGM TRADING UPDATE - STRONG START TO THE YEAR

Henry BootAnnouncement

26/05/2022 07:00

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RNS Number : 8344M  Boot(Henry) PLC  26 May 2022

 

26 May 2022

HENRY BOOT PLC

('Henry Boot' or 'the Group')

AGM TRADING UPDATE - STRONG START TO THE YEAR

 

Tim Roberts, Chief Executive Officer, commented:

 

"Henry Boot has enjoyed a very busy and successful start to the year, fuelled
by robust demand across our three key markets: Industrial & Logistics,
Residential and Urban Development. While the challenges of ongoing supply
constraints, cost inflation and increasing economic uncertainty cannot be
ignored, we believe we remain well placed for the rest of the year, with
strong forward sales across all our business lines, a continued pipeline of
opportunities for us to meet our strategic growth ambitions and, as ever, a
robust financial position".

 

Henry Boot has made a strong start to the year and continue to trade in line
with market expectations*. To date, the Group's performance has been supported
by land disposals and property development completions, with all three key
markets, Industrial & Logistics (I & L), Residential and Urban
Development performing well. In addition, the Group continues to make good
strategic progress towards the medium-term targets previously identified,
leaving the business well placed to achieve its growth aspirations.

 

Hallam Land Management (HLM) has had a strong start to the year selling 3,477
plots, after continuing buoyant demand and competitive bidding for sites from
housebuilders. The total plot sales will be higher this year due to a major
disposal at Didcot of 2,170 plots to national housebuilders Taylor Wimpey and
Persimmon Homes. HLM has replenished its land bank and despite achieving high
sales, the number of plots has remained stable at 92,569 plots (2021: 92,667).
HLM's trading outlook is positive, and it not only expects to achieve its
annual target for plot sales this year but is on track to deliver against its
strategic objective of an average of 3,500 plots sales per annum over the
medium term.

 

HBD has also made a good start to the year. The committed programme remains on
budget and on time and is currently 73% pre-let or pre-sold with continued
high demand from industrial occupiers. In particular, two land sales have
completed, comprising a 184-unit housing scheme in Skipton, which was pre-sold
to Bellway, as well as a land sale in Aberdeen to the city council for the
construction of 536 council houses. HBD is looking to bring forward further
schemes from the development pipeline, managing risk by a high level of
pre-let or pre-funding. In this regard, at Wakefield Hub, a planning consent
has recently been secured, subject to signing the S106 Agreement, for a
400,000 sq ft unit and HBD will look to pre-fund the scheme before adding it
to the committed programme in H2 2022. Looking ahead, HBD are close to signing
the development agreement to deliver Cheltenham Borough Council's Golden
Valley regeneration scheme and will continue to seek out selective
opportunities to replenish the development pipeline.

 

Within the £126 million investment portfolio, a number of properties have
been identified for potential sale. While these might reduce the size of the
portfolio in the short term if they are progressed, there are a number of
opportunities to replenish and grow the level of standing assets by retaining
completed developments which meet the Group's investment criteria.

 

Stonebridge Homes (SH) has now secured 93% of its 2022 delivery target of 200
units. The housing market continues to experience high demand, which has
resulted in sales values offsetting cost inflation. Planning has been obtained
at Ashtree Park (Barnard Castle), for 97 units and at Masham for 49 units.
Both sites are to be acquired this month. Works are expected to begin in June
2022 at Barnard Castle, which will be SH's first site opened in the North East
region, and in July 2022 at Masham.

 

Henry Boot Construction is trading in line with expectations and remains
focused on delivering its fully secured order book for 2022 and securing
contracts for 2023's order book. Work on the £40 million Build to Rent
residential scheme Kangaroo Works in Sheffield is on track to be completed in
Spring 2023. Good progress has also been made on the £47 million urban
residential development, Cocoa Works, in York, with the seven storey 279
apartment scheme due for completion at the end of 2023.

 

Both Banner Plant and Road Link (A69) are now trading ahead of budget.

 

Outlook

 

Henry Boot's three key markets remain characterised by buoyant demand. The
Group continues to manage build cost inflation and supply constraints,
achieving sale prices that are offsetting those pressures and allowing good
margin levels to be maintained.

 

Due to a number of significant transactions, 2022 performance is expected to
be weighted to the first half of the year and it is anticipated that whilst
levels of activity will be high in the second half, this will primarily be
contributing to the Group's performance for 2023 and beyond.

 

*Market expectations being the average of current analyst consensus of £47.8m
profit before tax, comprising three forecasts from Numis, Peel Hunt and
Panmure Gordon

 

For further information, please contact:

 

Enquiries:

 

Henry Boot PLC

Tim Roberts, Chief Executive Officer

Darren Littlewood, Group Finance Director

Daniel Boot, Group Communications Manager

Tel: 0114 255 5444

www.henryboot.co.uk

 

Numis Securities Limited

Joint Corporate Broker

Ben Stoop / Will Rance

Tel: 020 7260 1000

 

Peel Hunt LLP

Joint Corporate Broker

Charles Batten/Harry Nicholas

Tel: 020 7418 8900

 

FTI Consulting

Financial PR

Giles Barrie/ Richard Sunderland/ / Ellie Sweeney

020 3727 1000

henryboot@fticonsulting.com (mailto:henryboot@fticonsulting.com)

 

About Henry Boot PLC

 

Henry Boot PLC (BOOT.L) was established over 135 years ago and is one of the
UK's leading and long-standing property investment and development, land
promotion and construction companies. Based in Sheffield, the Group is
comprised of the following three segments:

Land Promotion:
Hallam Land Management Limited
(http://www.henryboot.co.uk/our-businesses/hallam-land-management/)

 

Property Investment and Development:
HBD (https://hbd.co.uk/) (Henry Boot Developments Limited), Stonebridge Homes
Limited (http://www.henryboot.co.uk/our-businesses/stonebridge-homes/)

 

Construction:
Henry Boot Construction Limited
(http://www.henryboot.co.uk/our-businesses/henry-boot-construction/) , Banner
Plant Limited (http://www.henryboot.co.uk/our-businesses/banner-plant/) , Road
Link (A69) Limited (http://www.henryboot.co.uk/our-businesses/road-link-a69/)

The Group possess a high-quality strategic land portfolio, an enviable
reputation in the property development market backed by a substantial
investment property portfolio and an expanding, jointly owned, housebuilding
business. It has a construction specialism in both the public and private
sectors, a long-standing plant hire business, and generates strong cash flows
from its PFI contract through Road Link (A69) Limited.

 

www.henryboot.co.uk (http://www.henryboot.co.uk)

 

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