REG - Watkin Jones plc - FY23 Trading Update

Watkin JonesAnnouncement

11/10/2023 07:00

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RNS Number : 6919P  Watkin Jones plc  11 October 2023

     11 October 2023

 

 

Watkin Jones plc

(the 'Group')

 

FY23 Trading Update

 

Watkin Jones provides the following trading update for the year ended 30
September 2023 (the 'year' or 'FY23'), ahead of the publication of the Group's
final results in January 2024.

 

FY23 trading

 

The Group was successful in achieving its operational objectives for the
second half of the year with practical completion on four schemes in the final
quarter and the sale of its three non-core PRS operational assets.

 

In our 19 July 2023 trading update (the 'July Trading Update') we indicated
that we did not expect to materially improve on the underlying PBIT recorded
in H1 of £2 million.  Since the trading update the Group has incurred
certain additional costs, including acceleration costs to ensure successful
completion on two schemes. These costs are not expected to carry forward into
the current year.  We now expect FY23 revenue to exceed £400 million and
underlying PBIT to be at approximately break-even.

 

Cash performance was strong in the final part of the year, with gross and net
cash of c. £72 million and c. £43 million, respectively, at 30 September
2023.  This increased cash balance includes the previously announced inflow
of c. £9 million from the sale of the three non-core PRS operational assets.

 

In the period since the July Trading Update, we have had significant focus on
operational and cost efficiencies within the business.  This has included
reviewing the overhead cost base and implementing a number of cost actions
which will generate annualised savings of over £2 million in FY24.

 

The Group's position on the exceptional provision for remedial works for
legacy properties remains unchanged from the July Trading Update.

 

FY24 Outlook

 

Whilst the current challenging market conditions are set to continue into the
start of FY24, the Group's level of secured revenue for FY24 is c. £330
million.  The Group is making progress with its assets for forward sale in
the market and remains active, but highly selective, in the land market.
 There is no change to the FY24 guidance provided in the July Trading Update.

 

- Ends -

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) No 596/2014 as it forms part of UK Domestic
Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").

 

For further information:

 Watkin Jones plc
 Alex Pease, Interim Chief Executive Officer  Tel: +44 (0) 20 3617 4453
 Sarah Sergeant, Chief Financial Officer      www.watkinjonesplc.com (http://www.watkinjonesplc.com/)

 Peel Hunt LLP (Nominated Adviser & Joint Corporate Broker)                     Tel: +44 (0) 20 7418 8900
 Mike Bell / Ed Allsopp                                                         www.peelhunt.com (http://www.peelhunt.com/)

 Jefferies Hoare Govett (Joint Corporate Broker)                                Tel: +44 (0) 20 7029 8000
 James Umbers/David Sheehan / Paul Bundred                                      www.jefferies.com (http://www.jefferies.com/)

 

Media enquiries:

 Buchanan
 Henry Harrison-Topham / Stephanie Whitmore  Tel: +44 (0) 20 7466 5000
 watkinjones@buchanan.uk.com                 www.buchanan.uk.com

 

 

Notes to Editors

Watkin Jones is the UK's leading developer and manager of residential for
rent, with a focus on the build to rent, student accommodation and affordable
housing sectors The Group has strong relationships with institutional
investors, and a reputation for successful, on-time-delivery of high quality
developments.  Since 1999, Watkin Jones has delivered 46,000 student beds
across 136 sites, making it a key player and leader in the UK purpose-built
student accommodation market, and is increasingly expanding its operations
into the build to rent sector.  In addition, Fresh, the Group's specialist
accommodation management business, manages over 22,000 student beds and build
to rent apartments on behalf of its institutional clients.  Watkin Jones has
also been responsible for over 80 residential developments, ranging from
starter homes to executive housing and apartments.

 

The Group's competitive advantage lies in its experienced management team and
capital-light business model, which enables it to offer an end-to-end solution
for investors, delivered entirely in-house with minimal reliance on third
parties, across the entire life cycle of an asset.

 

Watkin Jones was admitted to trading on AIM in March 2016 with the ticker
WJG.L.  For additional information please visit www.watkinjonesplc.com
(http://www.watkinjonesplc.com/)

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