TIDMINL
RNS Number : 8449P
Inland Homes PLC
15 October 2019
15 October 2019
Inland Homes plc
Trading Update
Inland Homes ("Inland Homes" "the Group" or "the Company"), the
leading brownfield developer, housebuilder and partnership housing
company with a focus on the south and south east of England, today
issues a trading update in respect of the 15 months ended 30(th)
September 2019 ahead of its results which will be announced in
January 2020.
Highlights
Revenue: GBP151m (2018: GBP150m)
Partnership housing equivalent units: 339 (30 June 2018: 82)
Open market completions: 200 (30 June 2018: 275)
Forward sales (at trading update): GBP41.6m (2018: GBP20m)
Total land bank plots: 7,796 (2018: 6,870)
Land plots sold: 577 (837 plots)
Number of plots with planning permission: 3,068 (2018:
1,547)
Cash: GBP9.5m (2018: GBP40m)
Net debt: GBP155m (2018: GBP80m)
Trading Performance
Significant progress has been made in the period with strong
momentum across the Group's operations and trading in the period
has been in line with the Directors' expectations.
After more than five years of intense work, we finally secured
planning consent on our flagship 100 acre Wilton Park site in
Beaconsfield, Buckinghamshire. We also secured consent for a new
"urban village" of 1,725 homes next to the station in Cheshunt
Hertfordshire, which took three years to gain.
These two consents will lead to a considerable increase in the
EPRA value of the Group's assets and provide a significantly
improved pipeline for our business activities. We are evaluating
routes to enable us to develop these projects to maximise the
returns for our shareholders.
As expected, private housing completions fell to 130 (2018: 275)
due to the significant number of large-scale apartment developments
under construction where occupations can only be achieved on
handover of completed blocks. We currently have 889 private homes
and 578 partnership housing equivalents under construction, which
provides an indication of the current scale of our development
programme. We have begun discussions with a number of build to rent
operators and expect to enter into this market which will reduce
our headline gearing and generate new capital to reinvest in our
business. Our high quality homes continue to sell well with an
average selling price of GBP250,000 and at an average sales rate
per active site over the last nine months of 0.71 homes per week.
This demand is underpinned by a shortage of new homes and supported
by the ongoing availability of "help to buy" and an environment of
low interest rates. The current forward order book for private sale
stands at GBP28.3m. In addition, we have forward sold the hotel
under construction in Bournemouth for GBP13.3m.
Our partnership housing equivalent units have increased by 313%
in line with our increased penetration into that marketplace. A
recent partnership housing contract worth GBP5.4m was secured for
Watford Community Housing Trust for 45 homes. We expect to secure
further significant contracts during the new financial year.
Our fledgling temporary modular housing business, Hugg Homes,
secured a pre-let to Broxbourne Council for 32 units at Cheshunt
during the period, bringing the total number of Hugg units
currently operational to 54 and producing gross rental income of
circa GBP500k per annum. We provide local authorities with a
high-quality alternative to bed and breakfast/hostel accommodation
at a considerable saving to the taxpayer whilst using Brownfield
land waiting for planning permission. Councils across England spent
approximately GBP1bn in 2017-18 on temporary accommodation,
indicating a significant market for Hugg Homes.
Planning & land bank
As previously stated, Wilton Park and Cheshunt Lakeside obtained
consent for over 2,000 new homes.
At Wilton Park, the initial consent is for 304 new homes and
1,730 sq m of commercial space. The current anticipated gross
development value is circa GBP350m. There is also a draft
allocation for further development on the site which if adopted
could provide a further 250 homes and 18,500 sq m of commercial
space. Inland also controls the access to other adjoining potential
development sites which could have additional monetary value. The
commercial space will be on the frontage to the Pyebush Roundabout
which is within half a mile of junction 2 of the M40, making an
attractive location for a high-quality business park.
The Cheshunt Lakeside planning permission for 1,725 homes and
19,000 sq m of commercial space will be one of the largest
brownfield developments in the South East, with an estimated gross
development value of over GBP620m. We expect to produce a mixed
tenure development comprising privately rented homes, homes for
sale as well as those built in partnership with housing
associations for affordable housing. There will be also be a new
school and significant employment opportunities for local people.
We expect to complete the purchase of our current joint venture
partner's interest in the project by the end of October 2019.
Our land bank now stands at a record 7,796 plots of which 3,068
have planning consent. Our growing strategic land portfolio where
most of the plots are controlled by discount to market value
options has increased significantly and now comprises 3,533 plots.
We are achieving a good success rate in getting sites allocated for
development in local plans.
Demand for consented housebuilding land remains strong with 577
plots sold in the period. Of these 207 were sold to other
housebuilders with 325 plots sold to housing associations.
The gross development value of our entire land bank now exceeds
GBP2bn.
Outlook
Our balanced business model of partnership housing, homes for
private sale and the sale of consented building land is serving us
well, whilst ancillary rental income of over GBP2.6m pa across the
Group is a useful by-product of our brownfield activities.
The demand from housing associations for the delivery of
"turnkey" projects, where we can deliver the land and the build, is
exceptionally strong and with the requirement for affordable homes
being high on government and local authority agendas. We believe we
are in an excellent position to grow the partnership housing
business significantly with the land bank that we are creating.
With a substantial number of highly sustainable sites suitable
for rental housing, we expect to secure the first build to rent
opportunities early in the new financial year. As the Group
evaluates this opportunity and considers the best way to develop
its sites at Wilton Park and Cheshunt, it will consider its funding
options with a view to maximising returns for shareholders.
Stephen Wicks, Group Chief Executive, commented:
"We have maintained our significant growth trajectory whilst
investing heavily in high quality staff and systems, at the same
time as improving build quality and increasing satisfaction with
both customers and partners.
"The business is performing well at all levels and we are laying
the foundations for significant future growth. With the benefit of
our new planning permissions and the momentum that has been
achieved, we are now well set to increase the scale and breadth of
the business."
Enquiries:
Inland Homes plc: Tel: +44 (0) 1494 762450
Stephen Wicks, Chief Executive
Nishith Malde, Finance Director
Gary Skinner, Managing Director
Panmure Gordon (UK) Limited Tel: +44 (0) 20 7886 2500
Dominic Morley
Erik Anderson
Instinctif Partners Tel: +44 (0) 20 7 457 2020
Mark Garraway
James Gray
Notes to Editors:
Incorporated in the UK in 2005, Inland Homes plc is an AIM
listed specialist housebuilder and brownfield developer, dedicated
to achieving excellence in sustainability and design.
Inland Homes acquires brownfield land in the South and
South-East of England principally for residentially led development
schemes. The business then enhances the land value by obtaining
planning permission, before building open market and affordable
homes or selling surplus consented land to other developers to
generate cash.
The Company is committed to extensive public and community
consultation in order to ensure that, where possible, local
community needs and objectives are met.
Inland's aim is to create sustainable communities and homes
which set a benchmark for all future developments in the South and
South East of England. The Company is always looking for brownfield
sites without planning permission for future development.
For further information, please visit the Inland Homes website
at www.inlandhomes.co.uk.
Hugg Homes - www.hugghomes.co.uk
Rosewood Housing - www.rosewoodhousing.co.uk
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END
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