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St. Modwen - Year End Results

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("St. Modwen" or "the Company")

Results for the year ended 30 November 2019

St. Modwen delivers continued progress on focused growth strategy

Mark Allan, Chief Executive of St. Modwen, commented: 

"2019 has been a positive year for St. Modwen. Following our major portfolio repositioning, our focus shifted to growth, building on the substantial opportunities in our existing portfolio. This resulted in another year of strong growth in housebuilding volumes and growing momentum in industrial and logistics development, where structural growth drivers remain positive. Underpinned by a solid balance sheet and continued capital recycling, we expect the delivery of our strategy to drive a meaningful improvement in return on capital and, with 22% growth in 2019, we are well on track to broadly double our adjusted EPRA EPS in the medium term."

Financial highlights

Non-statutory measures(1)




Statutory measures



EPRA NAV per share (pence)(2)




NAV per share (pence)(2)



Underlying total accounting return (%)




Total dividend per share (pence)



Adjusted EPRA earnings (£m)




Profit for the year (£m)



Adjusted EPRA EPS (pence)




Basic EPS (pence)



See-through loan-to-value (%)




Group net debt (£m)



  • NAV per share up 3.0% to 484.2 pence (2018: 470.2 pence)(2) despite 7.8 pence exceptional provision.
  • Underlying total accounting return of 6.3% (2018: 6.0%), before impact of 1.7ppt of exceptional provision.
  • Adjusted EPRA EPS up 21.7% to 17.4 pence (2018: 14.3 pence) reflecting successful delivery of strategy.
  • Total dividend for the year up 22.5% to 8.7 pence (2018: 7.1 pence) due to strong growth in earnings.
  • Profit for the year of £49.5m after £18.5m exceptional cost, with basic EPS of 22.8 pence (2018: 27.1 pence).
  • Conservative see-through LTV of 19.6% (2018: 16.9%) providing ample headroom for future investment.

Operational highlights

Strong progress across each of our three business units in delivering our growth-focused strategy, building on our existing deep pipeline of opportunities in three sectors with good structural growth prospects.

Industrial & Logistics: building leasing momentum; growing development activity

  • Grown industrial and logistics exposure to 44% of total portfolio by value (2018: 33%), driven by successful developments and underlying growth.
  • Delivered 0.9m sq ft of new space of which 97% will be retained (2018: 0.9m sq ft and 69%), with 58% of associated £5.5m ERV let or under offer, up from 54% for our 2018 completions this time last year.
  • Expect to deliver 1.5-1.7m sq ft of new space during 2020, of which 1.5m sq ft is already committed, 94% of which is set to be retained with an expected ERV of £9.5m, 18% of which is pre-let.
  • Grown total future pipeline to c. 19m sq ft, 45% of which already has planning with an associated ERV of c. £56m, providing substantial medium- and longer-term growth potential.

St. Modwen Homes: growing volume and margins; delivering high quality and customer service

  • Delivered 25% growth in volumes with 1,060 units sold during the year (2018: 848) and grown margins to 14.8% (2018: 14.4%), driving 28% growth in operating profit to £40.1m (2018: £31.3m).
  • Home Builders Federation customer satisfaction rating tracking over 90%, equivalent to 5* status, and net promotor score of 76 (2018: 63), underlining high quality and focus on customer service.
  • Pipeline in place to grow volumes by up to 20% p.a. to 2021 and opportunity to grow further, at a more normalised rate, beyond that, with clear steps identified to grow margins to c. 16-17% in medium term.
  • Current trading remains strong, with 34.0% of targeted full-year private sales forward sold (Feb 2019: 34.6%) and broadly similar improvement in margins expected for 2020 as for 2019.

Strategic Land & Regeneration: recycling capital; progressing longer-term opportunities

  • Sold £65m of non-core assets, including more than half of residual non-core retail, reducing non-core retail to just 2% of total portfolio by value, down from 16% at start of 2018.
  • Agreed sale of £30m of residential land (2018: £53m) in-year, and 663 plots at two large sites in South Wales for £25m since the year-end, with c. 900 plots across both sites in advanced legal discussions.
  • Prepared next phases of development at Longbridge for start on site in 2020, delivered latest phase of development at Swansea Bay Campus and progressed longer-term mixed-use opportunities. 

On track to broadly double adjusted EPRA EPS from 2018 level of 14.3 pence in medium term and deliver on ambition to grow total return to low-double digit levels over time, assuming markets remain stable, capitalising on significant growth potential embedded in existing pipeline and capital base.