Harworth Group (LON:HWG) Releases Quarterly Earnings Results

Harworth Group (LON:HWG) announced its quarterly earnings results on Wednesday. The company reported GBX (7.80) EPS for the quarter, Digital Look Earnings reports. Harworth Group had a net margin of 7.25% and a return on equity of 1.36%.

Here are the key takeaways from Harworth Group’s conference call:

• Industrial, logistics, and powered-land momentum remained strong, with three pre-lets completed or in legal negotiations after period-end, generating expected annualized rent of £3.7 million at a 17% premium to estimated rental value. The substantially construction-ready land bank reached a record 3.8 million square feet, with estimated gross development value of £600 million over the next three to five years.
• Harworth entered exclusivity with a leading data-center provider on a second hyperscale site, while its powered-land pipeline totals 0.8 gigawatts and could grow to 1.9 gigawatts. Management cited potential future profits of £292 million from the existing powered-land portfolio, although these estimates depend on securing planning, power, and full ownership assumptions.
• First-half total accounting return was -3.7%, with EPRA NDV per share falling from 224.4p to 214.8p. Residential exposure was the main drag, contributing substantial valuation losses due to softer housebuilder demand and higher construction costs, while net debt rose to £190 million from £145.9 million.
• The company plans to exit residential entirely and become a pure-play powered-land and industrial-logistics platform, reallocating capital toward segments that generated a reported 24% average annual return on capital employed over the past three years. Management is targeting low-double-digit long-term total accounting returns and expects the simplified structure to reduce costs.
• The board approved a 10% increase in the interim dividend to 0.592p per share, while liquidity remained £99.5 million and loan-to-portfolio value was 20.3%, below the company’s 25% ceiling. Harworth also said it may return surplus capital to shareholders after assessing future investment opportunities.

Harworth Group Trading Up 0.9%

HWG stock opened at GBX 176.60 on Thursday. Harworth Group has a 52 week low of GBX 116.80 and a 52 week high of GBX 185. The company has a market capitalization of £574.33 million, a PE ratio of 63.07 and a beta of 0.57. The company’s 50-day simple moving average is GBX 153.27 and its 200 day simple moving average is GBX 146.04. The company has a debt-to-equity ratio of 24.93, a quick ratio of 1.13 and a current ratio of 457.81.

Analyst Upgrades and Downgrades

Several brokerages have issued reports on HWG. Peel Hunt restated a “buy” rating and set a GBX 200 price objective on shares of Harworth Group in a research report on Wednesday, August 5th. Jefferies Financial Group reaffirmed a “buy” rating and issued a GBX 170 target price on shares of Harworth Group in a research report on Wednesday. Four analysts have rated the stock with a Buy rating, According to data from MarketBeat.com, the stock has an average rating of “Buy” and a consensus target price of GBX 196.75.

Harworth Group Company Profile

Harworth Group plc is a leading sustainable regenerator of land and property for development and investment which owns, develops and manages a portfolio of over 14,000 acres of land on around 100 sites located throughout the North of England and Midlands. The Group specialises in the regeneration of large, complex sites, in particular former industrial sites, into new residential and industrial & logistics developments. Visit www.harworthgroup.com for further information.