Harworth aims to tap into the Powerhouse

The Rotherham-based firm said its locations in the former mining areas of the North provide an obvious synergy with the Government’s plans for a Northern Powerhouse.

Harworth’s chief executive Owen Michaelson said: “The Northern Powerhouse is a good platform to refocus the advantages of the North.

“If you look at the corridor between Liverpool and Hull, you’ve got a population not far short of London. Let’s co-ordinate investment in primary infrastructure.”

Harworth reported a profit of £78m in 2015, which included a £44m gain from the acquisition of the remaining 75 per cent of Harworth Estates Property Group. This was up from £3.5m in 2014.

Harworth was re-listed on the London Stock Exchange last March, changing its name from Coalfield Resources following the acquisition of the 75 per cent stake.

Its coal mining roots make Harworth one of the largest landowners in the country.

“We are bringing communities back to life, communities that could have been blighted by the end of the coal mines,” said Mr Michaelson.

One of the group’s redevelopments is The Advanced Manufacturing Park in Rotherham on the site of the former Orgreave Colliery, the scene of one of the most bitter confrontations of the 1984 miners’ strike.

“Typically a coal mine employs 700 people. On The Advanced Manufacturing Park in Rotherham we’ve already got 1,000 people. We are making sure we maintain the vibrancy of the community,” said Mr Michaelson.

The group said it is well positioned for further growth.

“With the growth momentum already established in the business, we anticipate a larger number of sales, increased development spend and further acquisitions in 2016,” said Mr Michaelson.

“We have entered the new year with confidence, which is demonstrated by the proposed initiation of our dividend policy.”

Harworth is proposing a final dividend of 0.051p per share.

Analyst James Tetley at N+1 Singer said: “Harworth has released a confident set of 2015 prelims. The financial performance is ahead of our expectations and the momentum with which the group ended 2015 looks to have continued into the new year.

“Management has an excellent track record of unlocking value from the portfolio and ambitions to invest in new (former industrial) sites at a rate of £20m per annum over the medium term. A stated target of double digit post-tax returns on net assets looks highly achievable and underpins our ‘buy’ recommendation.”

Harworth sells about half of its land to housebuilders and the other half to commercial developers. It deals with Taylor Wimpey, Barratt and MJ Gleeson on the housing side and has sold plots to Rolls-Royce, Boeing, Aldi and Nissan on the commercial side.

Analyst Alison Watson at Investec said: “These are good numbers. Management announced a renewed portfolio focus towards brownfield sites.”