Harworth Group (LON:HWG) Announces Quarterly Earnings Results

Harworth Group (LON:HWG) issued its earnings results on Wednesday. The company reported GBX (7.80) earnings per share (EPS) for the quarter, Digital Look Earnings reports. Harworth Group had a negative net margin of 20.56% and a negative return on equity of 3.74%.

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 Stock Performance

Shares of LON HWG traded up GBX 0.80 during mid-day trading on Friday, reaching GBX 176.80. 1,885,372 shares of the company were exchanged, compared to its average volume of 564,306. The company’s 50-day simple moving average is GBX 155.28 and its 200-day simple moving average is GBX 146.32. The company has a quick ratio of 1.13, a current ratio of 441.42 and a debt-to-equity ratio of 29.88. The stock has a market capitalization of £575.00 million, a P/E ratio of 63.14 and a beta of 0.57. Harworth Group has a twelve month low of GBX 116.80 and a twelve month high of GBX 185.

Wall Street Analyst Weigh In

HWG has been the topic of several research analyst reports. Peel Hunt restated a “buy” rating and issued a GBX 200 price objective on shares of Harworth Group in a research note on Wednesday, August 5th. Jefferies Financial Group reiterated a “buy” rating and set a GBX 170 target price on shares of Harworth Group in a research note on Wednesday. Four investment analysts have rated the stock with a Buy rating, According to MarketBeat.com, the company has an average rating of “Buy” and an average price target of GBX 196.75.

About Harworth Group

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.