Financial Highlights

Non-statutory measures (¹) May 2018  Prior period (²)  Statutory measures  May 2018  Prior period (²) 
EPRA NAV per share (pence) 474.4 471.2 NAV per share (pence) 455.4 450.9
Total accounting return (%)     2.0     2.9 Interim dividend per share (pence)     3.10     2.02
Adjusted EPRA earnings (£m)   13.9   13.1 Profit before tax (£m)   25.9   31.6
Adjusted EPRA EPS (pence)     6.3     5.9 Basic EPS (pence)     9.4   12.1
See-through loan-to-value (%)   24.2   24.2 Group net borrowings (£m) 366.0 433.8
(1) Reconciliations between all the statutory and non-statutory measures and the explanations as to why the non-statutory measures give valuable further insight into the Group’s performance are given in note 2 to the condensed Group financial statements.
(2) Prior period measures are for the six months ended 31 May 2017 other than EPRA NAV per share, NAV per share, see-through loan-to-value and Group net borrowings, which are as at 30 November 2017. Comparative references to 2017 are for the six months ended 31 May 2017 and comparative references to Nov 2017 are as at 30 November 2017.
  • NAV per share up 1.0% over the six months to 455.4 pence (Nov 2017: 450.9 pence).
  • Total accounting return for the half year of 2.0% (2017: 2.9%) due to disposals.
  • Group net borrowings down £67.8m over the half year to £366.0m (Nov 2017: £433.8m).
  • See-through LTV stable since year end at 24.2% (Nov 2017: 24.2%).
  • Adjusted EPRA EPS for the half year up 0.4 pence to 6.3 pence (2017: 5.9 pence).
  • Interim dividend up 53.5% to 3.10 pence per share (2017: 2.02 pence per share).

Operational highlights

Considerable progress in repositioning our portfolio towards sectors with better long-term growth prospects and accelerating the delivery of our substantial development pipeline.

Portfolio focus and capital discipline:

  • Sold £350m of assets since the end of 2017, bringing total disposals since announcement of new strategy a year ago to £635m, driving significant improvement in portfolio mix.
  • Expect to exceed full year target to sell £100-150m of retail and small assets, with the sale of 28% of our retail portfolio for £95m during the half year and a further c. £70m of retail and small assets under offer.
  • Recycling capital out of existing assets into industrial/logistics pipeline to drive significant pick-up in income, reduction in costs and improvement in growth prospects in medium term.

Accelerate our commercial development activity

  • Increased committed industrial/logistics pipeline from 1.0m sq ft to 1.3m sq ft since start of the year, of which approximately two-thirds will be retained, with an ERV of £6.1m.
  • Obtained consent for 1.2m sq ft at key strategic sites at Chippenham Gateway and Copthorne, Gatwick with combined ERV of over £8m.
  • Prepared industrial/logistics pipeline for future growth; over 10m sq ft development potential across key strategic sites with ERV of over £60m deliverable over 5-8 years, partly subject to planning, plus over 5m sq ft development potential on smaller sites with over £30m ERV.

Grow our residential and housebuilding business

  • Delivered 31% growth in St. Modwen Homes’ volumes with 302 units sold in the first half (2017: 230 units), delivering a 23.3% increase in profit to £11.1m reflecting the low level of affordable completions during the previous period.  Expectation of up to 25% volume growth and 0.5ppt margin improvement for full year remains unchanged.
  • Sold 21 acres of residential land to third party housebuilders for £27m (2017: £14m), in line with book value, well on track versus our target to sell at least £56m this year.

Cement and grow our regeneration reputation

  • Released £141m of capital out of first phases of development at Longbridge and Swansea to bring forward significant residual development opportunities.
  • Preparing next phase of student housing and academic facilities at Swansea for delivery by 2021 and enhancing Longbridge vision ahead of employment-led next phase.